Ch  i-na.  - 


! >1 


1 . 


CHINA  vs.  JAPAN 


S.vi 


Digitized  by  the  Internet  Archive 
in  2017  with  funding  from 
Columbia  University  Libraries 


https://archive.org/details/chinavsjapanOOwood 


CHINA  1^5.  JAPAN 


Published  by 

Chinese  Patriotic  Committee 

New  York  City 


February,  1919 


CONTENTS 


1.  Introduction 

2.  The  Chino-Japanese  Question 

3.  Japan’s  Territorial  Expansion 

4.  Japan’s  Financial  Imperialism 

5.  Japan’s  Economic  Ambitions 

6.  The  Manchurian  Question 

7.  Japan’s  Political  Schemes 

8.  Japanese  Diplomacy 

9.  The  Open  Door  Policy 

10.  Conclusion 


CHINA  VERSUS  JAPAN 

Ge-Zay  Wood 


The  arrival  of  peace  in  Europe  has  lifted  the 
velvet  curtain  on  the  Far  East  which,  has  been  hid- 
den behind  the  scene  of  world  politics  for  the  last 
four  years  of  war.  Indeed,  the  Far  Eastern  ques- 
tion which  has  received  a temporary  eclipse  because 
of  the  war  clouds  that  have  been  hanging  over 
Europe,  and  that  are  now  beginning  to  disperse,  will 
soon  come  to  itself  when  the  question  can  be  pre- 
sented and  discussed  in  its  true  light.  The  world 
will  be  once  more  called  upon  to  face  the  problem  of 
unparalleled  magnitude  and  of  incalculable  impor- 
tance, not  only  to  China  and  Japan,  but  to  Europe 
and  the  United  States  as  well.  Newspaper  intelli- 
gence is  meagre  these  days  as  to  what  will  be  the 
ultimate  treatment  which  the  Far  Eastern  question 
will  receive  at  the  hands  of  the  world  surgeons 
who  are  now  dissecting  at  the  peace  table  the 
remains  of  a ruined  Europe ; indications  are  numer- 
ous, however,  that  there  can  be  no  peace,  no  per- 
manent peace,  unless  the  Far  Eastern  question  is 
solved,  and  solved  rightly.  The  correspondent  of 
The  New  York  Times  in  Peking  has  sounded  an 
ominous  note  when  he  wrote : “One  can  not  travel 
through  the  Far  East  to-day,  and  I have  been 
through  Japan,  Siberia,  and  China,  without  realiz- 
ing that,  v/hile  one  war  is  over  in  Europe,  another 
is  getting  rapidly  under  way  in  the  Pacific.  There 
are  conflicts  in  interests  and  policies  in  Siberia, 
Manchuria,  and  China  which  should  and  can  be 
peacefully  adjusted  in  Paris  if  only  the  facts  can 
be  placed  before  the  great  powers.”  And  why  not? 


3 


Those  nations  who  are  now  engaged  in  the  labo- 
rious task  of  rough-hewing  the  destiny  of  the  world 
ought  to  take  this  into  their  heart.  Although  very 
little  attention  has  so  far  been  paid  to  it  at  the 
peace  conference,  the  question  is  one  which  will 
ultimately  determine  the  success  or  failure  of  the 
conference. 

It  has  long  been  a diplomatic  platitude  among 
the  Eupean  chancelleries  that  the  origin  of  the 
European  war  can  be  traced  to  The  Near  Eastern 
question.  Granting  that  it  is  true,  it  is  but  natural 
to  ask  how  does  it  bring  about  the  war?  No  fair- 
minded  student  of  history  will  deny  that  the  blame 
lies  largely  with  the  European  powers  themselves. 
They  had  ample  opportunities  to  settle  the  question 
permanently,  in  the  interest  of  peace  and  for  the 
good  of  all.  Instead  of  so  settling  the  question, 
however,  the  interested  powers  chose  to  leave  it  as 
an  open  issue.  At  the  Congress  of  Paris  of  1856 
v/hich  brought  the  Crimean  W ar  to  a close,  the 
question  was  not  given  a proper  treatment ; at  the 
Congress  of  Berlin  of  1878  which  under  the  lead- 
ership of  Bismarck  revised  the  treaty  of  St.  Stefano, 
the  sam.e  question  became  worse  confounded ; and 
at  the  Conference  of  London  of  1913  at  the  end  of 
the  Balkan  wars,  the  settlement  was  another  piece 
of  patched-up  work  that  could  not  stand  the  acid 
test  of  time.  But  on  each  occasion,  the  powers  had 
the  opportunity  of  settling  the  question  permanent- 
ly, and  on  every  occasion,  the  powers  let  the  oppor- 
tunity slip  by.  As  a result,  the  so-called  Near  East- 
ern question  which  has  been  cankering  the  mori- 
bund Porte  ever  since  its  inception  and  taxing  the 
nervous  attention  of  the  European  chancelleries  re- 
mained, as  if  it  were,  a deadly  wound  on  the  body 
of  a sick  man,  unhealed  and  uncurable — so  much  so 


4 


that  to  have  anything”  to  do  with  it  required  such 
an  unusual  and  drastic  measure  that  it  was  destined 
to  shock  the  body  politic  of  the  whole  world.  Noth- 
ing: short  of  war  could  solve  the  question. 

The  same  thing-  is  true  of  the  Far  Eastern  ques- 
tion. Wars  have  been  fought  in  the  Far  East,  but 
the  issues  involved  have  never  been  settled  with 
any  satisfaction.  The  Opium  war  between  China 
and  Great  Britain  was  the  first  shot  which  was  des- 
tined to  break  through  the  foggy  mist  of  Oriental 
seclusion.  Then  the  other  wars  followed  one  an- 
other, but  they  were  successive  steps  of  the  politi- 
cal ladder  by  which  the  Western  powers  acquired 
their  present  dominating  positions  in  China.  But 
these  steps  belonged  to  the  dusty  limbo  of  bygone 
history;  and  as  such  we  are  not  concerned  with — at 
least,  not  any  more  than  the  European  Powers  will 
be  concerned  with  the  ancient  history  of  the  Sub- 
lime Porte.  It  was  only  with  the  Chino- Japanese 
war  of  1894-5  that  the  Far  Eastern  question  en- 
tered its  modern  form,  and  it  was  only  after  the 
Russo-Japanese  war  of  1904-5  that  it  has  assumed 
such  a magnitude  and  so  much  complexity  that  it 
has  baffled  every  effort  of  the  world’s  trained  diplo- 
matists for  its  solution.  The  war  of  1914  for  which 
the  allied  and  associated  nations  are  now  endeavor- 
ing at  Paris  to  bring  about  the  peace,  has  further 
complicated  the  question.  It  may  be  said  with 
equal  truth  that  golden  opportunities  were  suffered  to 
slip  by  without  effecting  a satisfactory  settlement 
of  the  Far  Eastern  question  when  it  was  perfectly 
possible  to  do  so.  The  Shimonoseki  negotiations  at 
the  conclusion  of  the  Chino-Japanese  war  seemed  to 
have  been  intended  for  creating  further  troubles 
than  for  cleaning  up  the  old  score.  The  unpardon- 
able ambition  of  the  Japanese  Government  to  seize 

S 


Liaotung  Peninsula  which  led  to  the  Franco-Ger- 
man-Russian  intervention  amply  proved  the  asser- 
tion. The  Portsmouth  Peace  treaty  was  more  of  a 
peace  settlement  of  a makeshift  sort  and  in  the 
nature  of  a transference  of  property  than  as  a solu- 
tion of  the  Far  Eastern  question  .which  the  war  had 
failed  to  solve.  The  fact  that  Japan  stepped  right 
into  the  Russian  boot  in  South  Manchuria  by  suc- 
ceeding to  all  the  rights,  privileges,  concessions,  and 
properties  granted  to  Russia  by  China  served  to 
strengthen  this  belief.  The  Anglo-Japanese  alli- 
ances, the  Franco-Japanese  Agreement,  the  Russo- 
Japanese  agreements,  and  the  open  door  agreements, 
which  have  been  one  and  all  ostensibly  intended  as 
the  instruments  to  operate  on  “the  sick  man  of  the 
Far  East’'  have  refused  to  work.  They  have  as  a 
matter  of  fact  turned  out  to  be  so  many  “scraps  of 
papers”  which  could  not  either  serve  the  surgical 
purposes  as  intended  or  help  solve  the  thorny  ques- 
tion. The  wound  has  thus  been  left  sore  and  open, 
and  it  has  become  much  worse  with  the  outbreak  of 
the  European  war  when  the  attention  of  the  Ameri- 
can and  European  surgeons  was  called  away.  While 
he  is  anxious  about  the  recovery  of  the  sick  man, 
the  American  doctor  is  somewhat  shy  of  the  disease 
for  one  reason  or  the  other.  Evidently  he  much 
prefers  to  offer  some  professional  advice  rather  than 
to  look  after  the  case  himself.  The  only  one  left  on 
the  spot  who  is  supposedly  in  possession  of  the 
modern  equipments  to  do  the  job  is  really  too  much 
absorbed  in  the  remunerations  he  is  to  receive  to 
look  after  the  welfare  of  the  patient.  Under  the 
guise  of  his  professional  calling  and  under  the  pre<^ 
text  of  helping  the  poor,  Japan,  the  only  medical 
man  available  for  the  last  four  years,  administered 
in  1915  a most  drastic  dose  to  China  from  which  she 

6 


is  not  likely  to  recover  unless  assisted  by  the 
experts  at  the  peace  conference.  In  other  words, 
instead  of  curing  the  wound  which  has  been  left 
uncured,  instead  of  solving  the  Far  Eastern  ques- 
tion which  has  been  left  unsolved,  Japan  has,  in  the 
absence  of  the  other  physicians,  injected  foreign  in- 
gredients into  the  body  politic  which  make  the  heal- 
ing all  the  harder  if  not  altogether  impossible.  The 
best  experts  on  the  Far  Eastern  question  will  read- 
ily agree  that  such  is  really  the  case.  While  it  can 
not  yet  be  said  to  be  hopeless,  it  is  serious  enough 
to  warrant  the  statement  that  further  delay  in 
treatment  will  spoil  all  chances  of  its  recovery. 

The  war  in  Europe  has  come  to  an  end.  It  is 
high  time  to  consider,  not  only  peace  in  Europe, 
but  peace  in  the  whole  world.  The  war  is  a world 
war,  and  the  problem  of  peace  is  certainly  and 
necessarily  a world  problem.  Now  can  this  problem 
be  solved  with  any  satisfaction  without  rightly  set- 
tling the  Far  Eastern  question?  Can  the  world 
have  peace  while  China  is  every  day  threatened 
with  War?  Can  the  peace  settlement  at  Versailles 
be  a just  one,  when  the  grievances  of  a nation  of 
400,000,000  people  are  not  redressed,  and  their 
wrongs  are  not  righted?  Can  President  Wilson’s 
principles  of  reconstruction  be  carried  out  in  spirit 
as  well  as  in  letter,  when  the  rights  of  the  so-called 
small  nations  are  not  respected  ? Can  there  be  any 
real  League  of  Nations  if  secret  treaties  which  are 
totally  incompatible  with  its  fundamental  objects 
are  suffered  to  exist?  Can  there  be  any  real  open 
door  policy  in  China  or  elsewhere  in  the  world, 
when  the  doors  already  opened  are  to  be  or  have 
been  closed  by  diplomatic  tricks?  These  are  some 
of  the  pertinent  questions  which  will  supply  food 
for  serious  meditation.  “The  impartial  justice 

7 


meted  out,”  says  President  Wilson,  “must  involve 
no  discrimination  between  those  to  whom  we  wish 
to  be  just  and  those  to  whom  we  do  not  wish  to  be 
just.  It  must  be  a justice  that  plays  no  favorites 
and  knows  no  standard  but  the  equal  rights  of  the 
several  peoples  concerned.”  Nothing  deserves  more 
respect  or  more  serious  consideration  than  this 
principle  of  impartial  justice  which  has  been  ac- 
cepted by  the  allied  nations  as  a basis  for  future 
peace.  Nothing  will  merit  greater  contempt  and 
severer  condemnation  than  preaching  one  thing  at 
one  time  and  practising  another  at  another  time. 
The  world  has  had  enough  of  this  sordid  practice, 
and  it  is  time  to  call  a halt. 

THE  CHINO-JAPANESE  QUESTION 

Those  are  laboring  under  misconception  who 
think  that  the  Far  Eastern  question  is  merely  of  lo- 
cal importance.  On  the  very  contrary,  the  question  is 
one  which  is,  as  said  at  the  very  outset,  of  unpar- 
alleled magnitude  and  of  incalculable  importance 
not  only  to  China  and  Japan  but  to  Europe  and  the 
United  States  as  well.  It  is  of  very  long  standing; 
and  before  it  comes  to  its  present  fashion  it  has  un- 
dergone a series  of  political  metamorphosis  which 
forms  one  of  the  most  interesting  chapters  of  the 
diplomatic  history  between  the  East  and  West.  In 
the  first  phase,  it  was  a question  of  opening  up  of 
the  regions  concerned  and  the  exploitation  of  the 
same  by  the  Western  Powers;  in  its  second  phase, 
it  was  a question  of  the  balance  of  power  which  the 
European  nations  sought  to  maintain  in  the  Far 
East  as  they  did  in  the  other  parts  of  the  world ; in 
its  third  phase,  it  took  on  the  garb  of  self-assertion 
of  the  East  in  face  of  the  aggressive  West;  in  its 

8 


fourth  and  present  phase,  the  Far  Eastern  is  essen- 
tially a Chino-Japanese  question.  It  is  not  of  im- 
portance to  know  the  details  of  the  evolutionary 
stages  through  which  the  question  has  come  to  its 
present  form,  but  in  order  to  understand  and  to 
solve  it,  it  is  highly  necessary  to  know  how  and  why 
the  Far  Eastern  question  has  come  to  be  a Chino- 
Japanese  question  as  it  is  to-day. 

The  story  of  the  rise  of  Japan  as  a first  class 
power  is  a tale  that  has  enchanted  and  fascinated  a 
great  number  of  the  Western  readers.  Students  of 
Chinese  history  can  readily  tell  how  China  was 
looked  upon,  before  the  fateful  year  of  1894,  as  a po- 
tential power  to  reckon  with  in  the  Asiatic  affairs. 
Russia  regarded  her  a powerful  ally;  France  knew 
what  it  meant  to  fight  with  China  after  the  war  of 
1884;  and  Great  Britain  even  went  so  far  as  to  agi- 
tate in  the  early  nineties  for  a defensive  and  offen- 
sive alliance  with  her.  But  behold ! what  had  hap- 
pened in  1894-5!  Japan’s  aggressive  policy  in  Korea 
led  to  the  Chino-Japanese  war.  Having  brought 
with  wonderful  secrecy  her  army  to  a high  state  of 
perfection  and  her  navy  to  correspond  by  learning 
everything  along  those  lines  that  could  be  learned 
from  Germany  and  Great  Britain,  Japan  resolved  to 
try  out  her  newly  acquired  strength  on  her  un- 
offending neighbor.  What  her  real  motives  were  in 
undertaking  this  unnecessary  war  have  already 
been  a patent  fact  to  the  entire  world.  It  may  be 
said,  however,  that  the  Japanese  invasion  in  China 
in  1894-5  set  the  tune  of  unprovoked  aggressions 
which  followed  one  after  another  right  upon  the 
heels  of  the  conclusion  of  the  Shimonoseki  treaty. 
China  was  thus  disabled,  deformed,  and  incapaci- 
tated. What  was  generally  supposed  as  a potential 
power  in  Asia  thus  became  a beaten  giant  over- 


9 


night.  In  the  words  of  Professor  Holland,  the 
Chino-Japanese  war  destroyed  the  reputation  of  one 
Power  and  created  that  of  another. 

Carried  away  by  the  glory  of  an  easy  victory  in 
the  war  and  intoxicated  with  the  enthusiasm  and 
ambition  of  expansion,  Japan  set  out  to  find  her 
place  in  the  sun.  Of  course,  she  had  to  be  prepared 
for  the  event.  During  the  years  which  immediately 
followed  the  Chino-Japanese  war,  Japan  behaved 
like  a well-behaved  child.  She  was  engaged  in  the 
grim  task  of  self-preparation  for  greater  events  to 
come.  While  the  European  eagles  were  gathering 
together  on  the  moribund  body  the  Chinese  Em- 
pire, Japan  alone  stayed  off,  not  because  that  the  pie 
was  not  to  her  liking,  but  because  it  might  prove  to 
her  indigestible.  One  has  to  be  internally  strong 
and  healthy  before  he  can  afford  to  take  any  heavy 
meal  that  is  likely  to  cause  indigestion.  It  took 
years  for  Japan  to  regain  her  lost  strength  and  be 
ready  again.  But  her  years  of  recovery  and  prep- 
aration were  greatly  hastened  by  a strong  dose  of 
tonic  which  was  administered  to  her  by  Great 
Britain  in  the  shape  of  the  Anglo-Japanese  Alli- 
ance of  1902.  Her  navy  was  brought  up  to  date ; 
her  army  was  reorganized  and  increased;  and  as  a 
result,  she  embarked  upon  another  voyage  of  con- 
quest. 

As  said  before,  the  Russo-Japanese  war  did  not 
settle  the  question.  As  a matter  of  fact,  the  war 
unsettled  it.  With  the  Russian  leases  and  rights 
turned  over  to  Japanese  hands,  and  with  the 
Mikado  stepping  into  the  Czarist  boot,  the  Far 
Eastern  question  could  be  said  to  take  the  shape  of 
a Chino-Japanese  issue  then  and  there.  Siam,  al- 
ways outside  of  the  political  orbit  in  the  Orient,  was 
not  then  as  it  is  not  to-day  very  much  bothered 


10 


with ; Korea  was  then  already  firmly  in  the  Japa- 
nese grip.  By  the  protocol  of  August  22nd,  1904, 
and  by  the  convention  of  November  17th,  1905,  the 
Hermit  Kingdom  had  signed  its  own  death  warrant ; 
Russia  was  beaten  in  the  battlefield;  England  was 
tied  down  hard  and  fast  by  her  morganatic  mar- 
riage ; and  it  is  not  too  much  to  say  that  in  Chi- 
nese affairs  England  seemed  to  be  quite  content 
with  playing  the  part  of  a second  fiddle ; the  mouth 
of  Erance  also  shut  in  the  Ear  Eastern  affairs  not 
only  because  that  her  ally  Russia  was  beaten  to  the 
knee,  but  also  that  she  was  tied  to  the  wheels  of 
Japanese  diplomacy  by  the  Eranco-Japanese  con- 
vention of  1907;  Germany  was  diplomatically  iso- 
lated in  the  Far  East,  as  the  Anglo- Japanese  Alli- 
ance, the  Russo-Japanese  agreements,  and  the 
Eranco-Japanese  convention  left  Germany  without 
a single  friend ; the  United  States  was  the  only 
country  then  which  was  not  bound  by  any  political 
considerations  or  secret  diplomatic  understandings 
with  the  other  Powers  in  regard  to  Chinese  af- 
fairs ; but  unfortunately,  American  policy  was  des- 
tined to  be  a subject  of  diplomatic  gossip  which  the 
Japanese  was  always  glad  to  hear  talked  about  but 
which  it  never  intended  to  carry  out.  So  coming 
down  to  the  bottom  of  fact,  the  Far  Eastern  ques- 
tion was  by  the  year  1908  already  a Chino-Japanese 
question — a question  between  China  on  the  one 
hand  and  the  group  of  foreign  powers  with  Japan 
at  the  head  on  the  other. 

The  truth  becomes  more  apparent  when  we  re- 
member how  as  the  guiding  genius  of  Far  East- 
ern politics  Japan  has  consistently  and  persistently 
tried  to  assume  the  overlordship  of  China.  She  has 
sought  this  by  two  means:  first  to  tie  the  hands  of 
those  powers  whose  interests  in  China  are  such  that 


they  can  not  be  ousted  or  to  isolate  diplomatically 
those  powers  whose  political  ambitions  elsewhere 
subject  them  to  such  a treatment;  and  secondly  to 
browbeat  China  in  every  possible  and  conceivable 
way.  In  carrying  out  the  first  policy,  the  Anglo- 
Japanese  Alliance,  the  Russo-Japanese  agreements, 
the  Franco-Agreement,  ar*d  the  Root-Takahira 
agreement  have  been  employed  by  Japan  as  a 
double-edged  weapon  which  cuts  both  sides.  They 
have  tied  the  hands  of  those  contracting  parties  by 
putting  themselves  in  line  with  Japan  in  the  Far 
Eastern  matters;  and  on  the  other  hand,  Japan  has 
thereby  acted  as  the  spokesman  of  the  entire  group. 
As  to  the  second  means,  the  ways  in  which  Japan 
has  repeatedly  browbeaten  China  constitute  a sick- 
ly chapter  on  the  Chino-Japanese  relation,  the  un- 
savory incidents  of  which  can  only  gradually  be 
brought  to  light.  It  is  sufficient  to  say  here  that,  be- 
cause of  the  rough  conduct  on  the  part  of  the  Japa- 
nese Government  in  its  diplomatic  dealings  with 
China  and  because  of  Japan’s  repeated  encroach- 
ments upon  her  unoffending  neighbor,  Japan  has 
been  looked  upon  as  the  only  power  which  is  delib- 
erately injuring  the  prestige  of  the  Chinese  Repub- 
lic abroad  and  blocking  its  progress  at  home.  No 
other  country  is  treating  China  as  Japan  has.  been. 
On  the  very  contrary,  with  the  collapse  of  Russia 
in  the  war,  with  Germany  ousted  from  the  Far  East, 
and  with  the  other  powers  deeply  absorbed  in  their 
home  problems,  Japan  alone  has  been  playing  fast 
and  loose  in  China.  Who  can  doubt  that  the  Far 
Eastern  question  has  become  virtually  a Chino- 
Japanese  issue? 

It  must  not  be  understood,  however,  that 
the  question  is  a simple  one.  Like  other  questions 
of  long  standing,  it  must  be  studied  and  understood 


12 


before  it  can  be  settled.  A doctor  must  know  the 
symptoms  of  his  patient  before  he  can  prescribe. 
The  case  must  be  examined  and  diagnosed  before 
it  can  be  treated.  What  is  true  in  the  medical  pro- 
fession is  also  true  in  international  matters.  We 
must  study  the  Chino-Japanese  question  in  a more 
or  less  detailed  fashion,  find  out  what  Japanese  am- 
bitions are,  what  Chinese  grievances  are,  and  then 
and  only  then  we  shall  be  in  a position  to  see  what 
is  the  real  trouble. 

JAPAN’S  TERRITORIAL  EXPANSION 

Modern  imperialism  is  a contagious  disease,  and 
living  in  a world  where  the  atmosphere  is  sur- 
charged with  germs  of  the  most  dangerous  sort, 
Japan  has  been  caught  in  this  terrible  grip  as  the 
European  powers  have  been.  The  first  symptom  of 
the  Chino-Japanese  trouble  is  found  in  Japan’s  in- 
satiable appetite  for  territorial  aggrandizement. 
The  key  to  the  solution  of  the  Chino-Japanese 
question,  if  there  is  one,  lies,  therefore,  in  the  an- 
swer whether  Japan  will  be  allowed  to  expand  at 
the  sacrifice  of  her  neighboring  republic.  The 
story  of  Japan’s  expansion  is  the  story  of  the  rise  of 
Japan  as  a first-class  power,  and  it  is  in  some  re- 
spects also  a story  which  tells  us  how  the  Chino- 
Japanese  question  has  come  to  its  present  fashion. 

Like  most  of  the  European  powers,  Japan 
came  too  late  in  the  Colonial  field,  and  by  the  time 
when  she  became  really  earnest  in  the  game  all 
the  choice  morsels  were  taken  or  occupied,  and 
there  was  nothing  worth  while  left  for  her.  Ger- 
many was  also  a late  comer  in  the  Colonial  field, 
but  she  was  lucky,  for  she  managed  to  secure  a 
foot-hold  in  Africa,  in  Asia,  and  in  the  South  Seas. 
There  was  no  colony  left  for  Japan,  and  the  only 

13 


way  of  expansion  that  still  remained  open  for  such 
purpose  was  on  continental  Asia.  Japan  knew  full 
well  that  such  was  the  grim  situation  that  con- 
fronted her  at  the  outset  of  her  enterprise.  She 
realized  that  she  would  be  pushed  back  in  any 
other  quarter  of  the  globe ; she  also  realized  that  in 
Asia,  so  near  to  the  Japanese  islands  geographic- 
ally, Japan  could  hope  to  obtain  satisfaction  no- 
where else  possible.  In  this  grim  realization  or 
determination  on  the  part  of  Japan  to  expand  on 
the  continent  lies  the  deadly  germ  of  the  Chino- 
Japanese  question.  Japan  could  not  expand  except 
at  the  expense  of  China,  and  with  but  one  exception — - 
that  of  Sakalien,  the  southern  portion  of  which  was 
ceded  to  Japan  after  the  Russo-Japanese  war  of  1905, 
every  inch  of  territory  which  Japan  has  acquired  orig- 
inally belonged  to  China.  China  has  lost  these  ter- 
ritories because  of  her  absolute  helplessness  and 
weakness;  Japan  has  acquired  them,  either  at  the 
point  of  bayonet  or  by  bold  swindling.  The  ques- 
tion is;  How  much  more  Japan  wants,  and  how 
much  more  China  will  be  forced  to  give  up?  Is 
Japan’s  territorial  appetite  so  insatiable?  Is  China 
so  helpless  as  to  acquire  a new  lease  of  life  only  by 
territorial  payment?  Can  we  call  a halt  to  this  foul 
practice?  Unless  President  Wilson’s  principles  are 
put  into  full  practice,  the  future  is  very  much  in 
doubt. 

We  notice,  in  the  first  place,  that  Japan  had  already 
given  an  unmistakable  indication  of  her  territorial 
ambitions  as  far  back  as  1870.  At  that  time  Japan 
had  not  yet  been  opened  up  very  long,  and  was 
scarcely  organized  or  prepared  to  take  in  any  new 
territory.  But  the  surprise  is  that  she  did.  Loochow 
Island  was  annexed  in  1870  without  the  least  reason. 
Now  whether  the  island  belonged  to  China  or  to.  Japan 

14 


is  a question  of  fact  which  history  can  best  answer. 
But  history  tells  us  that  Chinese  suzerainty  over  Loo- 
chow  Island  can  be  traced  back  to  605  A.D.,  and  it 
was  in  1372  that  the  Loochuans  formally  and  defi- 
nitely acknowledged  Chinese  supremacy.  Henceforth 
they  acknowledged  being  tributary  to  China,  sending  a 
mission  to  Peking  every  other  year.  In  the  meantime 
trade  relations  with  Japan  were  also  established.  In 
1609  the  Japanese  prince  of  Satsuma  invaded  the 
island,  took  the  capitol  by  storm,  and  captured  the 
king  and  carried  him  away  to  Japan.  He  was  re- 
stored to  the  throne  a few  years  later  on  condition  of 
paying  tribute,  to  Japan.  This  the  Loochuans  did,  but 
they  still  continued  to  pay  tribute  to  China,  who  was 
recognized  by  them  as  the  real  suzerainty.  The 
Chinese  Government,  in  spite  of  Japan’s  apparent  ag- 
gression, sought  to  adjust  the  matter  peaceably.  But 
in  1870,  when  Japan  attempted  to  treat  Loochow  as 
an  integral  part  of  the  Mikado’s  dominions  by  con- 
verting it  into  a Japanese  prefecture,  China  took  up 
the  matter  with  great  caution.  The  relation  between  the 
two  nations  became  so  strained  that  war  was  threat- 
ened. General  Grant,  who  was  then  in  China  on  his 
world  tour,  offered  to  mediate.  A conference  was 
held  in  Peking  whereby  China  and  Japan  essayed  to 
bring  about  a partition  of  the  island.  While  satisfac- 
tory arrangement  was  impossible,  the  Japanese  con- 
tinued their  measures  for  the  effective  administration 
of  the  island. 

The  second  helping  was  served  at  the  conclusion  of 
the  Chino-Japanese  war  of  1895,  which  furnished 
fresh  opportunities  for  Japan’s  territorial  aggrandize- 
ment. Japan  demanded  as  a price  of  peace  a big  in- 
demnity, the  cession  of  Formosa,  and  the  Pescadores 
Islands,  and,  intoxicated  by  the  first  flush  of  victory, 
she  even  went  so  far  as  to  demand  the  cession  of  Liao- 


15 


lung  Peninsula,  in  total  disregard  of  the  future  secur- 
ity of  the  Peking  Government,  of  public  opinion,  and 
of  the  faint  admonitions  of  the  rest  of  the  world. 
We  do  not  know  whether  or  not  this  excessive  and 
unreasonable  demand  was  an  ultimate  expression  of 
Japan’s  territorial  ambition  which  was  let  loose,  nat- 
urally enough,  at  the  conclusion  of  the  war.  Cries 
for  territory  and  clamours  for  spoils  are  always  loud- 
est when  a victorious  war  is  won.  People  simply  go 
crazy.  This  is  but  human,  and  it  would  be  hardly 
just  to  hold  the  Japanese  as  exceptions  to  the  rule. 
On  the  other  hand  it  must  be  said  that  the  demand  for 
the  cession  of  Liaotung  Peninsula  was  indicative  of 
puerile  statesmanship  of  a hot-headed  party,  afifected 
as  it  has  always  been  by  over-sanguineness  which  is 
a not  unusual  concomitant  of  the  expansionist  disease. 
Evidently  there  was  not  wisdom  enough  in  the  coun- 
try to  foresee  what  was  coming  or  to  have  cooled 
down  the  passion  of  the  war  party,  and  any  faint 
voice  raised  against  undue  annexation  might  have  been 
drowned  in  the  militant  clamour  for  territorial  aggran- 
dizement. A coalition  of  three  Powers  stepped  in : 
Russia,  France,  and  Germany  threatened  war  unless 
Japan  abandoned  the  claim.  The  debauch  indulged 
in  in  the  night  before  had  to  be  followed  by  sermons 
of  soda-water  nature  the  day  after.  Japan  had  to 
give  up  Liaotung  Peninsula,  to  be  satisfied  with  a 
large  war  indemnity,  the  Pescadores  Islands  and  the 
Formosa,  although  these  possessions  are  extremely 
fertile  in  soil  and  rich  in  resources  and  therefore 
treasure-troves  in  themselves. 

In  1905  Japan  made  further  acquisitions.  It  has 
been  said  that  war  is  a legitimate  means  of  conquest, 
and  as  such  Japan  would  be  among  the  first  to  make 
use  of  it.  The  Russo-Japanese  war  was  brought  about 
by  a clash  of  territorial  ambitions  of  these  two  Powers 

16 


in  Manchuria  and  Korea,  and  it  was  natural  that  ter- 
ritorial adjustment  should  be  the  main  feature  of  peace 
settlement.  In  the  negotiation  of  peace  at  Ports- 
mouth, the  Japanese  delegates  insisted  upon  the  re- 
tention of  the  Russian  leases  in  Manchuria  and  the 
cession  of  Sakalien  Island.  The  Russian  delegates 
demurred.  Long  negotiations  followed,  and  finally 
Count  Witte  agreed  to  the  transfer  of  the  leased  ter- 
ritory in  China  on  condition  that  China’s  consent 
should  be  secured.  As  to  Sakalien,  it  touched  Rus- 
sia’s dignity  and  would  not  be  given  up  so  easily.  The 
Czar  of  Russia  repeatedly  instructed  his  envoys  to 
break  off  the  negotiations  as  the  Japanese  delegates 
insisted  on  the  cession  of  the  Island.  He  was  re- 
ported to  have  observed  that  “neither  a rood  of  land 
nor  a rouble  shall  Japan  receive.  From  this  position 
nothing  will  ever  make  me  recede.”  The  negotia- 
tions were  brought  to  a breaking  point,  but  thanks  to 
President  Roosevelt’s  mediation,  Japan  was  enabled 
to  retain  the  southern  half  of  Sakhalien  Island.  Port 
Arthur  and  Talienwan  also  fell  into  Japanese  hands. 

Japan’s  appetite  for  new  territory  was  whetted 
with  eating.  She  acquired  Loochow  Island  in  1870 ; 
Formosa  and  Pescadores  in  1895;  Sakhalien  in  1905, 
and  she  was  still  clamouring  for  more.  Her  passion 
for  territory  almost  amounted  to  a disease.  But  she 
went  about  it  in  a quiet  manner.  In  1884  she  signed 
the  Tientsin  agreement  with  China,  respecting  Korean 
autonomy.  Korea  had  been,  of  course,  a tributary 
to  China  for  centuries.  The  plain  fact  that  Japan 
wished  to  make  it  independent  indicated  what  her  in- 
tentions were.  In  1894-5  went  to  war  with 

China  again  to  maintain  the  independence  of  Korea. 
On  August  26,  1894,  at  the  beginning  of  the  Chino- 
Japanese  war,  a Korean-Japanese  alliance  was  con- 
cluded, the  object  of  which  was  to  maintain  the  in- 

17 


dependence  of  Korea  on  a firm  footing.  In  the  treaty 
of  Shimonoseki,  China  was  made  to  recognize  defi- 
nitely the  full  and  complete  independence  and  auton- 
omy of  Korea.  In  the  Russo-Japanese  agreement  of 
April  25,  1898,  both  governments  recognized  definitely 
the  sovereignty  and  entire  independence  of  Korea,  and 
pledged  themselves  mutually  to  abstain  from  all  direct 
interference  in  the  internal  affairs  of  that  country. 
The  Anglo-Japanese  alliance  of  1902  had  as  one  of  its 
objects  the  maintenance  of  the  territorial  integrity  of 
Korea.  Even  when  declaring  war  against  Russia,  the 
Mikado  said  in  his  Rescript,  February  10,  1904:  “The 
integrity  of  Korea  is  a matter  of  gravest  concern  to 
this  Empire — the  separate  existence  of  Korea  is  essen- 
tial to  the  safety  of  our  realm.”  The  same  provision 
was  made  in  the  Protocol  of  February  23,  1904,  be- 
tween Japan  and  Korea.  The  third  article  of  the  said 
instrument  provides  “The  Imperial  Government  of 
Japan  definitely  guarantees  the  independence  and  terri- 
torial integrity  of  the  Korean  Empire.” 

So  far,  so  good.  But  Japan’s  sinister  designs  upon 
Korea  soon  came  to  light  in  a naked  fashion  when, 
in  the  Portsmouth  treaty  of  peace,  Russia  was  made 
to  acknowledge  Japan’s  paramount  political,  military 
and  economic  interests  in  Korea,  and  in  the  second 
Anglo-Japanese  alliance  nothing  was  said  about 
Korean  independence  and  integrity — which  was  the 
raison  d’etre  of  the  first  alliance.  On  November  17, 
1905,  another  innocent  agreement  was  entered  into 
between  Korea  and  Japan  whereby  Korean  foreign 
relations  were  given  to  Japanese  control.  In  1906 
Marquis  Ito  was  made  Resident  General  in  Korea; 
in  1907  Japan  blocked  a Korean  delegation  to  the 
Hague  Conference;  in  1909  Marquis  Ito  declared  that 
'"orea  must  be  “amalgamated”  with  Japan;  in  1910 
what  was  expected  happened : Korea  was  annexed  to 

18 


Japan.  By  war  and  diplomacy  Japan  compelled  first 
China  and  then  Russia  to  acknowledge  Korean  inde- 
pendence ; by  understanding  and  agreement  Japan  was 
able  to  persuade  England  and  other  Powers  to  wash 
their  hands  of  the  future  of  Korea;  by  a series  of 
“guarantee  treaties’’  Japan  succeeded  in  attaining 
overlordship  of  that  Kingdom;  and  by  court  intrigue, 
corruption,  coercion,  and  other  clandestine  means, 
Japan  induced  the  Korean  Emperor  and  his  represen- 
tatives to  sign  the  fatal  agreement  of  August  22,  1910, 
whereby  this  unhappy  Hermit  Kingdom  passed  into 
the  dusty  limbo  of  forgotten  history.  The  whole 
story  is  a tragedy;  its  recapitulation  serves  only  to 
recall  the  buried  past  and  to  draw  a picture  of  how 
the  bird  of  prey  goes  after  its  victim  patiently  and  yet 
persistently. 

Japanese  imperialism,  however,  does  not  stop  here. 
A new  opportunity  was  offered  for  aggrandizement 
in  'the  outbreak  of  the  European  War,  1914.  Japan 
was  requested  by  Great  Britain  to  look  after  the  British 
shipping  interests  in  the  Ear  Eastern  waters.  But 
much  more  than  that  was  asked  of  her,  Japan  de- 
clared war  upon  Germany.  An  expedition  was  sent 
to  capture  Tsingtao,  in  which  the  British  forces  were 
compelled  to  participate  for  political  considerations. 
It  was  then  understood  that  Japan’s  military  and  naval 
operations  would  be  limited  to  the  Northern  Pacific. 
But  before  long,  the  Caroline,  Marshall  and  Ladrome 
islands  in  the  South  Seas  fell  into  Japanese  hands. 
These  islands,  together  with  the  German  leased  coun- 
try, have  been  under  Japanese  military  occupation. 
Japan  has  promised  to  restore  Kiaochow  to  China,  but 
the  Japanese  delegates  at  the  Peace  Conference  have 
pressed  hard  for  the  retention  of  the  captured  German 
colonies  in  the  South  Seas  and  the  German  fortress 
Tsingtao  in  China. 


19 


iiere  we  have  in  a nutshell  the  story  of  Japanese 
expansion.  Except  the  south  portion  of  the  Sakhalien 
which  was  wrested  from  Russia,  and  except  the  Ger- 
man possessions  in  the  Pacific,  the  Caroline  and  the 
hlarshall  islands,  the  disposition  of  which  is  still  in 
the  hands  of  the  Peace  Conference,  every  other  inch 
of  territory  which  Japan  has  acquired  has  been  ac- 
quired from  China.  In  1870  she  took  Loochow  island 
from  China;  in  1895  she  seized  Formosa  and  Pesca- 
dores from  China;  in  1905  she  leased  Kwantung 
Peninsula  from  China;  in  1910  she  annexed  Korea 
after  the  latter  was  detached  from  China.  Indeed, 
there  is  no  limit  to  Japan’s  territorial  ambition.  Her 
appetite  is  insatiable ; her  thirst  is  unquenchable.  On 
the  one  hand,  Japan  professes  to  adhere  to  the  Chino- 
Japanese  treaty  of  May,  1915,  and  undertakes  to  re- 
store Kiao  Chow  to  China.  On  the  other,  she  means 
to  keep  Tsingtao  as  an  exclusive  concession  agreed 
upon  in  the  said  treaty  and  thus  play  the  game  of 
eating  the  oyster  herself  and  leaving  the  shell  to  China. 
This  is  all  clever  enough.  But  the  question  is  how 
much  predatory  spirit  can  be  permitted  to  enter  into 
the  final  peace  settlement?  President  Wilson,  in  his 
speech  of  July  4,  1918,  said  that  “the  settlement  of 
every  question,  whether  of  territory,  of  sovereignty, 
of  economic  arrangement  or  of  political  relationship” 
must  be  “upon  the  basis  of  the  free  acceptance  of  the 
settlement  by  the  people  immediately  concerned,  and 
not  upon  the  basis  of  the  material  interests  or  advan- 
tage of  any  other  nation  or  people  which  may  desire  a 
different  settlement  for  the  same  of  its  own  exterior 
influence  or  mastery.”  China  looks  forward  to  a 
just  settlement  based  upon  this  principle. 


20 


JAPAN’S  FINANCIAL  IMPERIALISM 

So  far  we  have  dealt  only  with  Japan’s  territorial 
ambitions.  There  are  other  avenues,  however, 
through  which  the  Empire  of  the  Rising  Sun  hopes 
to  be  the  master  of  the  celestial  kingdom.  Modern 
devices  of  subjugating  a nation  have  advanced  to 
such  a stage  that  the  process  can  be  carried  out  to 
perfection  without  a single  resource  to  arms.  The 
most  telling  instance  is  the  passing  away  of  Egypt,  of 
Morocco,  and  of  Persia,  and  anyone  who  is  at  all 
acquainted  with  the  history  of  those  unfortunate 
countries  can  readily  point  out  that  the  foreign 
financial  domination  of  a nation  will  inevitably  lead 
to  its  downfall.  Japan  has  proved  herself  to  be  an 
apt  student  of  Western  science  and  of  Western  state- 
craft, and  no  one  knows  any  better  than  Japan  her- 
self that  in  carrying  out  her  sinister  designs  upon 
China  nothing  is  so  peaceful  and  yet  so  effective  as 
financial  domination  which  leads  to  ultimate  control. 
Japan  has  bought  Korea  with  Yen  104,000,000,  which 
sum  was  gradually  advanced  to  that  unfortunate  coun- 
try four  years  before  her  annexation;  she  is  now  try- 
ing to  buy  up  China  with  small  loans  and  large  loans, 
with  her  own  money  which  she  has  made  during  the 
war,  and  with  the  money  which  she  has  managed  to 
borrow  from  the  other  powers.  It  is  high  time  for 
us  all  to  wake  up  to  the  real  danger  which  is  threat- 
ening the  existence  of  the  Chinese  Republic. 

It  is  to  be  recalled  that  Japan’s  financial  imperial- 
ism is  comparatively  of  recent  growth.  Japan  well 
knew,  of  course,  what  it  was,  but  the  savory  dish  was 
not  tasted  until  1895  when,  as  a result  of  the  Chino- 
Japanese  war,  Japan  received  a huge  indemnity  of 
230,000,000  taels  from  China.  It  was  then  that  Japan 
put  into  actual  practice  the  art  of  haut  finance;  and  it 


21 


was  since  then  that  China  has  increased  her  foreign 
indebtedness.  Prior  to  the  war,  China’s  foreign  debt 
was  almost  nil ; but  after  it  she  became,  for  the  first 
time  in  her  history,  a serious  borrower  in  the  Euro- 
pean markets.  The  terms  of  the  Shimonoseki  treaty 
included  the  cession  of  Liaotung  Peninsula,  the  ces- 
sion of  Formosa,  and  the  Pescadores,  an  indemnity  of 
200,000,000  taels,  and  their  various  commercial  privi- 
leges. But  the  excessive  nature  of  these  demands 
brought  the  European  Powers  on  the  scene.  Russia, 
France  and  Germany  intervened  on  the  ground  that 
the  occupation  by  Japan  of  Liaotung  Peninsula  would 
be  a menace  to  China,  and  so  it  was.  But  the  retro- 
cession of  the  peninsula  was  paid  for  with  30,000,000 
taels  in  addition.  This  huge  indemnity  was  so  bene- 
ficially utilized  by  Japan  that  she  was  enabled  to  re- 
form her  currency  by  adopting  the  gold  standard,  to 
build  up  her  navy  almost  equal  in  size  to  that  of 
Russia,  and  to  carry  out  many  reforms  which  would 
have  been  impossible  otherwise.  The  outbreak  of 
the  Boxer  Rebellion  in  1900  furnished  to  Japan  an- 
other golden  opportunity  to  enrich  herself,  while 
the  same  trouble  cost  China  another  big  indemnity 
that  will,  if  it  is  not  cancelled  at  the  Paris  Peace 
Conference,  keep  China  in  financial  servitude  for  a 
good  many  years  to  come. 

One  interesting  feature  about  Japan’s  financial 
policy  is  that  she  is  ever  ready  to  lend  money  to  China. 
If  Japan  has  not  the  money  herself,  she  will  at  least 
play  the  part  of  a broker.  It  does  not  make  a whit  of 
difference  to  Japan,  so  long  as  she  can  get  hold  of 
China’s  most  valuable  security  and  be  assured  of  a 
high  rate  of  interest,  whether  the  money  thus  loaned 
to  China  is  to  be  wasted  or  to  be  expended  for  useful 
purposes.  Of  course,  all  Japanese  loans  are  made 
ostensibly  for  the  most  plausible  uses — such  as  for  the 


22 


construction  of  railways,  reform  of  currency,  indus- 
trial development,  etc.  As  a matter  of  fact,  Japan 
has  never  been  actuated  by  such  high  motives  On 
the  very  contrary,  Japan  will  not  hesitate  to  block 
China’s  economic  development  if  such  development 
may  prove  to  be  disadvantageous  to  her  own  interests 
in  China.  The  only  motives  that  have  actuated 
Japan’s  reckless  lending  are  to  get  hold  of  China’s  re- 
sources, to  secure  unusually  high  rates  of  interest,  to 
exclude  European  and  American  financial  activities  in 
China,  and  finally  to  secure  financial  domination  over 
the  Chinese  Republic  as  England  has  secured  over 
Egypt,  and  France  over  Morocco.  This  is  a rough 
sketch  of  Japan’s  financial  ambitions,  and  it  does  not 
take  much  scholarship  to  sustain  the  theme.  A single 
instance  will  be  sufficient  for  the  purpose. 

Early  in  1908  a single  group  of  American  bankers 
undertook  a loan  of  $20,000,000  for  the  use  of  in- 
dustrial development  in  Manchuria  and  for  the  cur- 
rency reform  in  China.  To  this  American  group  were 
added  later  other  groups,  representing  England,  Ger- 
many and  France,  thus  making  a financial  combination 
known  as  the  “Four-Power-Group.”  After  the  estab- 
lishment of  the  Chinese  Republic  in  1911,  this  group 
was  asked  to  finance  the  Provisional  Government,  and 
to  place  a loan  of  $300,000,000,  to  be  issued  over  a 
period  of  five  years,  the  proceeds  of  which  were  to 
be  employed  to  liquidate  outstanding  indebtedness,  and 
to  carry  out  numerous  administrative  reforms.  The 
importance  of  a loan  of  this  nature  called  forth  an 
urgent  demand  from  the  Russian  and  the  Japanese 
governments  for  their  participation,  although  they  had 
no  money  to  lend.  Once  admitted,  they  proved  them- 
selves such  a stumbling  block  in  the  negotiation  that 
it  was  almost  broken  up.  Russia  insist’ed  that  the 
money  thus  borrowed  must  not  be  used  for  military 


23 


purposes  in  Mongolia,  which  had  just  declared  its  in- 
dependence of  China.  Japan  insisted  that  no  part  of 
the  loan  should  be  employed  for  the  purpose  of  Man- 
churian development,  for  to  so  employ  it  would  con- 
flict or  injure  Japan’s  economic  interests  already  ac- 
quired therein.  What  a preposterous  demand!  And 
how  absurd!  But  such  is  the  real  Japanese  attitude — - 
the  dog-in-the-manger  policy  which  she  adopts  when- 
ever she  has  no  money  to  lend  herself.  She  does  not 
want  to  be  left  behind,  but  she  does  not  wish  to  see 
others  go  ahead;  she  does  not  care  to  help  China’s 
economic  development,  but  she  can  see  no  better  ex- 
cuse in  lending  money  to  China  than  for  that  purpose ; 
she  has  no  money  to  lend,  as  a matter  of  fact,  but  she 
knows  that  the  security  is  too  attractive  to  ignore. 
The  natural  resultant  of  these  conflicting  views  is  a 
policy  which  amounts  to  this : “I  have  determined 
to  lend  money  to  China,  either  alone  or  in  combination. 
I must  have  a share  in  every  loan  that  you  may  make 
to  China.  If  I have  no  money  to  lend,  you  must  let 
me  play  the  part  of  an  honest  broker;  else  absolutely 
nothing  doing.” 

Before  the  outbreak  of  the  War,  in  August,  1914, 
Japan  had  to  measure  her  strength  in  the  financial 
markets  of  New  York,  London,  and  Paris.  In  the 
matters  of  foreign  loans  to  China,  and  in  other  finan- 
cial transactions  in  the  Far  East,  Japan  had  to  look 
forward  to  the  United  States  and  to  the  European 
Powers  for  direction  and  assistance.  She  was  vir- 
tually impotent  without  their  help.  The  war  of  1914, 
however,  has  removed  the  European  Powers  from  the 
scene  of  activity,  and  left  Japan  alone  in  the  field. 
The  immense  profits  which  she  has  made  in  the  war 
have  not  only  enabled  her  to  pay  off  a large  amount  of 
her  debt,  but  also  put  her  in  the  foremost  front  as  a 
lending  power  to  China.  Indeed,  the  amount  which 
i 24 


Japan  has  lent  to  China  since  August,  1914,  is  so  large 
that  Japan’s  financial  domination  over  China  is 
seriously  threatened.  The  following  is  a list  of  loans, 
from  1903  to  July  15,  1918,  which  Japan  has  made  to 
China.  The  magnitude  of  the  amount  lent,  particu- 
larly after  the  outbreak  of  the  European  war,  indicates 
the  buccaneering  activity  of  the  Japanese  Government 
in  exploiting  China  and  in  sending  the  infant  republic 
to  the  debtor’s  prison.  We  owe  the  list  to  Mr.  J.  B. 
Powell,  editor  of  the  Millard’s  Review ; 


I. 

1909 

Hinumintun  Mukden  Ry.  loan 

Yen 

320,000 

2. 

1909 

Kirin-Chengchun  Ry.  loan 

H 

2,150,000 

5- 

1910 

Peking-Hankow  Ry.  Redemption  loan  “ 

2,200,000 

4- 

I9II 

Peking-Hankow  Ry.  Redemption  loan  “ 

10,000,000 

5- 

1912 

Hankow  Waterworks  loan 

<1 

1,000,000 

6. 

1912 

Hunan  & Hupeh  Provincial  loan 

2,000,000 

Yen, 

17,670,000 

7- 

1903 

Loans  to  Hanyehping  Company 

Yen 

3,000,000 

8. 

1906 

Loans  to  Hanyehping  Company 

(t 

1,000,000 

9- 

1906 

Loans  to  Hanyehping  Company 

a 

2,000,000 

10. 

1908 

Loans  to  Hanyehping  Company 

« 

1,500,000 

II. 

1908 

Loans  to  Hanyehping  Company 

500,000 

12. 

1909 

Loans  to  Hanyehping  Company 

6,000,000 

13- 

1910 

Loans  to  Hanyehping  Company 

<< 

1,000,000 

14. 

1912 

Loans  to  Hanyehping  Company 

tt 

2,000,000 

IS- 

1913 

Loans  to  Hanyehping  Company 

u 

15,000,000 

Yen, 

32,000,000 

16. 

1915 

Szepiukai-Chengchiatun  Ry.  loan 

Yen 

5,000,000 

17. 

1915 

General  loan 

(t 

1,000,000 

18. 

I9IS 

Asiatic  Development  Co.  loan 

“ 

5,000,000 

19. 

1916 

Shantung  Provincial  loan 

1,500,000 

20. 

1916 

Kwangtung  Provincial  loan 

n 

1,500,000 

21. 

1917 

Bank  of  Communication  loan 

“ 

5,000,000 

22. 

1917 

Fengtien  Provincial  loan 

“ 

2,000,000 

23- 

1917 

Szepiukai-Chenchiatun  Ry.  loan 

tt 

2,600,000 

24. 

1917 

Kwangtung  Provincial  loan 

3,000,000 

25- 

1917 

Bank  of  China  loan 

5,000,000 

26. 

1917 

Part  of  2nd  Reorganization  loan 

“ 

10,000,000 

25 


Yen 


27. 

1917 

Chili  flood  loan  Y 

er 

28. 

1917 

Kirin-Changchun  Ry.  loan 

(( 

29. 

1917 

Grand  Canal  loan  (part) 

(( 

30. 

1918 

Flood  Relief 

(( 

31- 

1918 

Government  loan 

n 

32. 

1918 

Changchun  Ry.  loan  (supplement) 

(( 

33- 

1918 

Chili  Provincial  loan 

n 

34- 

1918 

Part  of  2nd  Reorganization  loan 

(< 

35. 

1918 

Hupeh  Provincial  loan 

n 

36. 

1918 

Fukien  Provincial  loan 

n 

37- 

1918 

Chili  Provincial  loan 

3S. 

1918 

Army  loan 

n 

39- 

1918 

2nd  loan  to  Bank  of  Communication 

(( 

40. 

1918 

Telegraph  loan 

n 

41. 

1918 

Wireless  loan 

n 

42. 

1918 

Kirin-Changchun  Ry.  loan 

n 

43- 

1918 

Fengtien  Provincial  loan 

(( 

44- 

1918 

Hupeh  Provincial  loan 

(( 

45- 

1918 

Shensi  Provincial  loan 

(( 

46. 

1918 

Military  loan 

<( 

47- 

1918 

Forest  loan 

48. 

1918 

2nd  Reorganization  loan  (3d  advance)" 

49. 

1918 

Yunnan  Provincial  loan 

(( 

5,000,000 

6.500.000 

5.000. 000 

200.000 

2.000. 000 

630.000 

1.000. 000 

10.000. 000 

2.500.000 

1,000,000 

1.000. 000 

14.000. 000 

20.000. 000 

20,000,000 

3.000. 000 

20.000. 000 

3.000. 000 

1.000. 000 

1.000. 000 

2.000. 000 

30.000. 000 

10.000. 000 

3.000. 000 


Total  Yen,  248,100,000 
Pre-War,  including  Han  Yehping,  “ 49,670,000 

Since  August,  1914  “ 198,430,000 

Besides  these  loans  there  are  many  others  which 
have  been  made,  but  the  terms  have  been  kept  secret. 
For  the  construction  of  a railway  from  Sinan  to 
Shuntefu  in  Chili,  a loan  running  up  several  millions 
was  made  at  the  ruinous  rate  of  interest  of  8 per  cent. 
One  of  the  chief  terms  demanded  is  that  China  shall 
agree  to  the  establishment  of  Japanese  civil  officers  in 
Shantung.  Another  loan  of  some  20  million  Yen  was 
contracted  (Yen  6,000,000  already  advanced)  for  the 
construction  of  five  railways  in  Manchuria  and  Mon- 
golia, with  the  condition  that  the  Japanese  should  be 
given  the  right  to  work  mines  of  the  entire  territory. 

26 


A military  loan  of  4 million  Yen  bearing  interest  at  8 
per  cent,  was  reported,  one  of  its  conditions  being  that 
Japanese  military  officers  were  to  train  the  Chinese 
army.  A political  loan  of  some  two  million  Yen  was 
also  reported  While  China  has  acquired  the  habit  of 
reckless  borrowing,  Japan  has  acquired  one  of  reckless 
lending.  The  one  borrows  to  play  ducks  and  drakes 
with,  while  the  other  lends  with  a purpose.  Financi- 
ally China  is  in  the  most  critical  situation  ever  known 
in  her  history.  Unless  she  wakes  up  to  the  danger 
herself,  or  foreign  control  steps  in,  the  fate  of  Egypt, 
of  Morocco,  of  Korea,  and  of  Persia  will  become  her 
own.  Japan  seems  liberal  with  China  in  money  mat- 
ters, but  the  day  will  soon  come  when  she  will  demand 
her  pound  of  flesh. 

Japan’s  latest  financial  stunt — or,  to  be  more  exact, 
the  latest  device  with  which  she  has  sought  to  complete 
her  financial  domination  over  China — came  in  the 
shape  of  her  benevolent  assistance  to  reform  China’s 
present  currency.  There  are  very  few  devices  more 
astute  and  more  damaging  to  China’s  sovereignty  than 
the  sinister  plans  which  Japan  has  put  forward  to  es- 
tablish “a  Gold-note  Currency  in  China,  based  upon  a 
Gold  Reserve  held  in  Japan.”  That  is,  China  is  called 
upon  to  have  a make-believe  Gold  Currency  by  issuing 
$80,000,000  of  gold  notes  to  be  circulated  first  in 
Peking  and  then  throughout  China,  without  any  gold 
in  reserve.  The  only  reserve  will  be  an  equivalent 
amount  of  bank  notes  to  be  borrowed  from  Japanese 
banks. 

A secret  agent  of  the  Japanese  Prime  Minister 
Terauchi  came  to  China  in  May,  1918,  with  the  pro- 
posal that  the  Japanese  Yen  should  be  adopted  as  the 
Chinese  gold  standard.  This  was  rejected,  but  the 
secret  envoy  was  too  shrewd  a person  to  be  thus 
baffled.  ‘Tf  you  will  issue  gold  bank-notes  similar  to 


27 


the  Japanese,”  he  turned  around  and  said  to 

the  Chinese  Government,  “the  Chosen  Bank  and  the 

* 

Taiwan  Bank  can  lend  you  an  equivalent  amount  of 
money;  that  is,  a requisite  amount  of  Japanese  bank- 
notes.” In  other  words,  he  suggested  that  currency 
reform  could  be  undertaken  by  making  believe  that 
the  Japanese  bank  notes  were  as  good  as  gold  reserve. 
Whether  this  is  sound  economic  principle  we  will  not 
inquire.  We  are  only  concerned  with  the  political 
motives  which  actuated  the  Japanese  Government  to 
take  such  a bold  step. 

There  are  three  motives  behind  the  scheme,  and  it 
does  not  take  any  profound  scholar  of  Far  Eastern 
politics  to  discern  what  they  are.  In  the  first  place, 
it  has  been  the  intention  of  the  Japanese  Government 
to  fish  in  the  troubled  waters  by  keeping  the  North 
fighting  the  South  indefinitely.  The  loan  of  Yen,  8o,- 
000,000  was  of  course  made  nominally  and  ostensibly 
for  the  issue  of  the  gold  notes,  i.e.,  for  currency  re- 
form in  China.  But  who  could  doubt  that  part  of  it 
was  to  be  employed  to  fight  the  South  ? In  the  second 
place,  it  has  been  said  that  American  participation  in 
the  Chinese  finance  has  appeared  to  the  Japanese 
statesmen  as  highly  dangerous.  Availing  herself  of 
the  distressing  conditions  of  a bankrupt  China,  Japan 
has  thought  it  a right  moment  to  strike.  A loan  of 
Yen  80,000,000  is  none  too  large;  but  it  is  sufficiently 
large  to  keep  China  in  Japan’s  financial  bondage  for 
years  to  come.  The  fact  that  an  effort  has  been  made 
to  hurry  through  the  scheme  and  that  the  regulations 
for  gold  notes  should  have  been  promulgated  soon 
after  America’s  declaration  of  a new  financial  policy 
for  China,  gives  an  inkling  of  Japan’s  desire  to  fore- 
stall American  activity.  The  third  motive  has  been 
said  to  be  an  insidious  plan  of  Japan  to  break  up  the 
Banking  Consortium  which  signed  the  currency  loan 

28 


agreement  with  China,  April  15,  1911.  The  fact  that 
Japan  alone  has  supplied  the  requisite  amount  for 
China’s  currency  reform  means  that  no  more  foreign 
assistance  is  called  for.  On  the  other  hand,  the  Bank- 
ing Consortium  will  ipso  facto  relapse  into  inactivity 
since  the  raison  d’etre  has  ceased  to  exist.  By  elimi- 
nating the  Foreign  Consortium,  Japan,  being  alone  in 
the  field,  is  freer  than  ever  to  financially  dominate 
China.  This  is  one  of  the  reasons  which  have  caused 
Hollington  K.  Tong  and  other  Chinese  patriots  to  utter 
a shrill  call  for  an  international  control  of  Chinese 
finance.  Both  are  bad  and  both  are  poisonous.  But, 
like  the  helpless  Dorax  in  Dryden’s  play,  China  may 
yet  save  herself  by  swallowing  two  different  poisons, 
each  of  which  is  an  antidote  of  the  other ! 

These  are  the  motives  on  the  part  of  Japan,  but 
what  are  the  effects  of  this  Gold  Note  Currency  on 
China?  Of  course  notes  cannot  be  issued  without 
security.  Financial  history  and  financial  experience 
of  any  country  will  tell  the  same  tale.  That  China 
has  been  persuaded  to  issue  notes  with  make-believe 
reserve  is  fundamentally  wrong.  The  fiscal  dangers 
such  a venture  carries  in  its  train  are  too  numerous  to 
be  narrated  here.  It  is  bad  enough  to  issue  gold  notes 
without  gold  reserve;  but  to  issue  gold  notes  on  the 
strength  of  bank  notes  borrowed  from  a foreign  coun- 
try is  infinitely  worse.  We  can  foresee  the  principal 
effects  which  will  necessarily  follow  such  a nefarious 
scheme. 

In  the  first  place,  China  has  almost  placed  herself 
in  the  position  of  a Japanese  dependency.  “The  mo- 
ment when  China  issues  gold  notes  with  their  paper  re- 
serve kept  in  Japan,  she  becomes  a Colony  of  Japan  in 
reality.  Gold  notes  are  issued  in  the  Philippines  and 
their  reserve  is  kept  in  the  United  States  of  America. 


29 


They  are  issued  in  India,  and  their  reserve  is  kept  in 
England.  They  are  issued  in  the  Dutch  Indies,  with 
their  reserve  kept  in  Holland.  Now  they  will  be 
issued  in  China,  but  their  reserve  will  be  kept  in  Japan. 
The  Philippines,  India  and  the  Dutch  Indies  are  Colo- 
nies of  America,  England  and  Holland  respectively. 
China  will  be  a Colony  of  Japan  if  she  actually  un- 
dertakes the  absurd  gold  note  scheme.”  In  other 
words,  with  China’s  carrying  out  the  schemes,  Japan’s 
financial  imperialism  scores  the  greatest  triumph. 
Secondly,  China  places  in  Japanese  hands  the  power 
to  control  her  finance,  by  placing  in  Japanese  hands 
the  power  of  her  note  issue.  The  reserve  will  be  kept 
in  Japan;  the  note  issue  will  be  controlled  by  Japan; 
and  Japan’s  financial  domination  over  China  is  thus 
complete. 

JAPAN’S  ECONOMIC  AMBITIONS 

Modern  imperialism  is  a garment  of  many  colors. 
Together  with  the  process  of  territorial  aggrandize- 
ment and  the  policy  of  financial  domination  in  China, 
Japan  is  pursuing  yet  a more  subtle  and  dubious  path 
of  what  is  generally  known  as  “peaceful  penetration.” 
The  process  has  been  lately  very  much  discredited  be- 
cause of  its  German  association;  but  Japan,  an  earn- 
est and  fervent  admirer  of  Germany  and  everything 
German — Japan  is  not  infrequently  called  “Prussia  of 
the  Far  East” — is  by  no  means  dismayed  by  the  popu- 
lar resentment  with  which  the  process  of  peaceful 
penetration  has  been  received  by  the  world  nowadays. 
Japan  has  been  pursuing  the  policy  in  Manchuria,  in 
Fukien,  and  she  is  now  pursuing  it  in  the  Shantung 
province.  She  certainly  knows  its  efficacy,  and  she 
knows  how  to  handle  the  most  effective  weapon  with 
which  she  proposes  to  purloin  China.  Economic  pen- 


30 


etration  is  but  a handmaid  of  financial  imperialism; 
the  two  go  hand-in-hand.  One  cannot  go  without  the 
other.  Or,  more  accurately  speaking,  one  is  the  logi- 
cal sequence  of  the  other.  Since  Japan  is  bent  upon 
financially  dominating  China,  it  is  but  natural  that  both 
processes  should  be  set  in  motion  and  be  utilized  to 
their  utmost. 

Japan’s  economic  designs  in  China  are  so  ambitious, 
and  the  evidences  of  economic  penetration  are  so 
many,  that  in  the  limited  time  and  space  at  our  dis- 
posal it  is  absolutely  impossible  to  describe  them  in 
any  detail.  To  do  so  will  require  volumes.  It  will 
be  quite  sufficient  for  our  purpose  to  bring  out  here  a 
few  typical  instances  of  Japan’s  economic  ambitions  in 
China  from  which  the  readers  can  draw  their  own  con- 
clusion. We  have  pointed  out  how  Japan  has  sought 
territorial  expansion  in  China;  we  have  told  the  story 
of  Japan’s  financial  imperialism;  and  we  have  also  ob- 
served that  economic  penetration  is  but  a handmaid 
of  financial  domination.  Now  we  shall  see  how  Japan 
has  utilized  the  one  as  a lever  with  which  she  secures 
commercial  privileges  and  economic  concessions  from 
China,  and  the  other  as  a fulcrum  upon  which  she 
seeks  political  and  economic  domination.  The  pro- 
cess is  incredibly  simple. 

In  the  first  place,  in  order  to  understarid  Japan’s 
economic  position  in  China,  we  may  ask  why  the  Euro- 
pean Powers  were  at  one  time  so  anxious  for  oversea 
possessions  ? Why  they  were  so  eager  to  despoil  China 
at  the  end  of  the  nineteenth  century?  Why  is  Ger- 
many so  desirous  of  getting  back  her  lost- Colonies,  and 
why  are  the  other  Powers  so  desirous  of  keeping 
them  ? Many  answers  may  be  given,  and  each  one  may 
be  different  from  the  other,  but  there  is  one  fact  that 
underlies  them  all— that  all  oversea  possessions,  aside 


31 


from  their  ability  of  furnishing  raw  materials  and  cre- 
ating new  markets,  are  really  the  best  sort  of  economic 
footholds.  This  is  particularly  true  of  the  European 
and  Japanese  possessions  in  China.  Those  foreign 
leased  territories  in  China  have  proved  to  be  more  val- 
uable as  economic  bases  than  as  anything  else.  Japan 
has  in  China  many  such  advantages.  Port  Arthur  and 
Dalny  were  transferred  over  to  Japan  after  the  Russo- 
Japanese  war  of  1905,  and  their  original  leases  have 
been  extended  to  99  years  as  a result  of  the  Chino- 
Japanese  negotiations  of  1915.  Fukien  and  Inner 
Mongolia  have  been  taken  as  Japan’s  spheres  of  influ- 
ence. Japan  is  now  moving  heaven  and  earth  at  the 
Peace  Conference  to  keep  Tsingtao,  by  insisting  upon 
the  validity  of  the  Chino- Japanese  treaty  of  1915. 
With  these  places  as  strategic  bases— for  they  are  stra- 
tegic economically — Japan  is  in  a domineering  position 
which  will  enable  her  to  put  out  of  competition  other 
Powers  who  are  not  so  favorably  situated.  Instances 
have  been  produced  again  and  again  of  how  Japan  has 
resorted  to  the  unfair  means  of  economic  discrimina- 
tion in  South  Manchuria  by  subsidizing  Japanese 
steamship  lines,  by  rebates,  by  preferential  tariff,  and 
by  other  devices.  These  have  been  carried  out  all 
under  the  aegis  of  the  regime  of  the  leased  territories 
in  Manchuria.  Is  there  any  one  who  doubts  as  to  the 
usefulness  of  the  leaseholds  as  economic  bases  in 
China  ? 

Disregarding  generalities,  now  let  us  come  to  the 
specific  instances.  The  first  thing  that  comes  to  our 
mind  is  the  mining  industry  in  China,  which  has  fallen 
into  Japanese  hands.  We  are  quoting  the  Secretary 
of  the  Eastanian  when  we  say : “A  good  deal  of  the 
mining  industry  in  China  is  also  under  control  of 
Japan — the  Yangtze  coal  mine,  the  Sun  Shan  coal  mine 


32 


and  Qiin  Ling  iron  are  all  in  Shantung,  with  a capital 
of  12,000,000  marks  (this  being  Germany’s  property 
before  the  war).  The  Sak-pa-ling  coal  mine  and  the 
Yentai  coal  mine  are  in  Manchuria.  The  Fuchan 
coal  mine  has  a capital  of  12,254,065  Yen,  and  con- 
tains 800,000,000  tons  of  coal.  With  the  Yentai  mine, 
they  both  have  a daily  output  of  about  8,000  tons  of 
coal.  The  Pen-hsi-su  coal  mine  and  the  An-shan- 
chang  iron  mine  are  Chino-Japanese  joint  enterprises. 
It  has  been  estimated  that  the  Pen-hsi-su  mine  contains 

123.000. 000  tons  of  coal,  and  An-shan-chang  contains 

100.000. 000  tons  of  ore.”  All  these  riches  and  valu- 
able mines  are  in  the  Japanese  grip.  Japan  has  ob- 
tained besides  these  an  iron  mine  at  Feng-kwan-shan 
and  a few  mines  throughout  the  Yangtze  Valley,  which 
was  generally  supposed  to  be  British  sphere  of  influ- 
ence. Japan  is  also  reported  to. have  secured  the 
rights  of  opening  the  iron  mines  at  Feng-wang-shan 
and  Mei-lin-kwan  in  Kiangsu  province. 

With  the  conclusion  of  the  so-called  treaty  of 
Peking  of  May  25,  1915,  which  brought  to  a close 
the  protracted  negotiations  in  regard  to  “the  twenty- 
one  demands.”  Japan  has  acquired  further  rights 
to  operate  coal  and  iron  mines  in  China.  The  num- 
ber of  mines  is  so  large  and  the  area  covered  by 
them  is  so  extensive  that,  compared  with  those  ac- 
quired by  Japan  in  1907  as  a result  of  the  Chientao 
Dispute,  which  we  have  no  time  to  take  up,  one  is 
perfectly  justified  in  supposing  that  Japan’s  art  of 
wringing  concessions  from  China  has  been  improved 
by  leaps  and  bounds.  It  is  sufficient  to  quote  the 
language  of  the  note  exchanged  between  the  Chinese 
and  Japanese  Governments  in  regard  to  this  mat- 
ter, in  order  to  show  the  number  of  mines  conceded 
and  the  area  covered  by  them.  “Japanese  subjects 


33 


shall,  as  soon  as  possible,  investigate  and  select  mines 
in  the  mining  areas  in  South  Manchuria  specified 
hereinunder,  except  those  being  prospected  for  or 
worked,  and  the  Chinese  Government  will  then  per- 
mit them  to  prospect  or  work  the  same : — 


I.  In  Fengtien  Province 

Locality 

1.  Niu  Hsin  Tai 

2.  Tien  Shih  Fu  Kou 

3.  Sha  Sung  Kang 

4.  T’ien  Ch’ang 

5.  Nuan  Ti  T’ang 

6.  An  Shan  Chan  region 

II.  In  Kirin  Province 

1.  Sha  Sung  Kang 

2.  Kang-Yao 

3.  Chia  P’i  Kou 

It  is  to  be  noted  that  all 


District  Mineral 

Pen-hsi  Coal 

Pen-hsi  “ 

Hai-lung  “ 

Tung-hua  “ 

Chin 

Liaoyang  to  Pen-hsi  “ 

Ho-lung  Coal 

Chi-lin  Gold 

Hua-tien  “ 

these  coal  and  gold  mines 


fall  within  the  confines  of  the  Manchurian  Pro- 


vinces, and  it  is  in  Manchuria,  as  we  shall  point  out 
a little  later  that  Japan  has  been  carrying  out  in  a 
minute  form  the  subtle  process  of  peaceful  penetra- 
tion. By  hook  and  crook  which  Japan’s  well-culti- 
vated art  of  diplomatic  ingenuity  is  ever-ready  to 
devise,  Japan  has,  one  after  the  other,  acquired  lease- 
holds, railways,  police-rights,  mines,  etc.  in  Ma!n- 
churia.  It  ought  to  be  superfluous  to  point  out  that 
they  are  the  most  powerful  economic  weapons  with 
which  to  conquer  a nation. 

Besides  this,  Japan  has  been  seeking  after  China’s 
tobacco  and  wine  monopoly.  'This  ambition  was  re- 
vealed in  a clear-cut  fashion  in  June,  1918,  when  the 
Japanese  bankers,  for  a loan  of  Yen  30,000,000  de- 
manded that  wine  and  tobacco  tax  should  be  pledged 
as  security,  and  that  an  administration  for  its  collec- 
tion, similar  to  the  Salt  Administration,  with  a Japa- 
nese at  the  head  of  it,  should  be  established.  Japan 


34 


has  cherished  the  pious  hope  that  with  the  conclusion 
of  the  loan  China’s  wine  and  tobacco  tax  would  be 
transferred  to  Japan  for  collection,  and  that  the  mon- 
opoly for  both  wine  and  tobacco  trades  in  China  would 
forever  remain  in  the  Japanese’  hands.  Now  it  is  a, 
very  well-known  fact  that  the  Chinese  people  spend 
more  than  Mex.  $ioo,ocx),ooo  a year  for  cigars,  cigar- 
ettes and  wine,  and  a monopoly  of  the  trade  by  Japan 
will  net  her  the  greatest  pecuniary  profit  possible.  It 
is  also  a well-known  fact  that  the  wine  and  tobacco 
tax,  at  least  a part  of  it,  has  already  been  pledged  to 
France  for  a small  loan  from  the  Bank  Industrielle  de 
Chine  and  to  the  United  States  for  a loan  of  $5,000,000 
from  the  Continental  Trust  Savings  Bank  of  Chicago. 
The  fact  that  Japan  demanded  wine  and  tobacco  tax 
as  security  in  spite  of  and  in  disregard  of  the  previous 
pledges  shows  that  she  was  bent  upon  wringing  con- 
cessions and  more  concessions,  monopolies  and  more 
monopolies,  from  China. 

But  this  is  not  all.  Japan  has  been  trying  to  get 
hold  of  anything  and  everything  worth  having  in 
China — economical,  commercial  and  industrial.  That 
such  is  the  case  is  further  illustrated  in  her  earnest 
effort  to  exploit  China’s  cotton  resources  and  iron  in- 
dustry. As  usr'ial,  Japan  poses  as  a friend  of  China, 
deadly  anxious  to  help  out  the  young  Republic  along 
economical  and  industrial  lines ; and  as  usual,  Japan 
looks  as  innocent  as  a sucking  dove.  This  time  she 
wants  to  help  China  develop  iron  production  and  cot- 
ton industry,  and  she  proposes  to  do  it  in  this  fashion : 
“We  shall  return  You  the  balance  of  the  Boxer  In- 
demnity, and  with  this  money  we  propose  to  establish 
a number  of  iron  works  and  spinning  mills  in  Shang- 
hai, Hankow,  and  Tientsin,  and  other  leading  treaty 
ports.  As  the  Boxer  Indemnity  is  to  be  used  for  the 


35 


purpose,  we  should  be  allowed  to  have  direct  control 
of  these  works.”  Here  is  the  essence  of  the  whole 
scheme — or  an  outline  of  the  conditions  under  which 
Japan  proposes  to  return  her  share  of  the  Boxer  In- 
demnity. A clever  scheme  it  is  indeed — one  that  is 
really  worthy  of  Japanese  ingenuity!  On  the  one 
hand,  the  fact  that  these  iron  works  and  spinning  mills 
are  to  be  established  with  Japan’s  share  of  the  Boxer 
Indemnity  removes  any  local  opposition.  On  the 
other,  through  the  iron  works  and  spinning  mills 
Japan  can  control  the  iron  resources  and  cotton  in- 
dustry of  China. 

It  is  to  be  recalled  that  Japan,  in  1915,  made  a des- 
perate effort  to  secure  the  control  of  the  Hanyehping 
Company  and  through  it  the  control  of  China’s  iron 
and  steel  resources.  The  third  Group  of  “the  twenty- 
one  demands”  uses  the  following  language : “The 
Japanese  Government  and  the  Chinese  Government, 
seeing  that  Japanese  financiers  and  the  Hanyehping 
Company  have  close  relations  with  each  other  at  pres- 
ent and  desiring  that  the  common  interests  of  the  two 
nations  shall  be  advanced,  agree  to  the  following  arti- 
cles : ( I ) The  two  contracting  parties  mutually  agree 
that  when  the  opportune  moment  arrives  the  Hanyeh- 
ping Company  shall  be  made  a joint  concern  of  the  two 
nations  and  they  further  agree  that  without  the  pre- 
vious consent  of  Japan.  China  shall  not  of  her  own 
act  dispose  of  the  rights  and  property  of  whatsoever 
nature  of  the  said  Company,  nor  cause  the  said  Com- 
pany to  dispose  freely  of  the  same.  (2)  The  Chinese 
Government  agrees  that  all  mines  in  the  neighborhood 
of  those  owned  by  Hanyehping  Company  shall  not 
be  permitted,  without  the  consent  of  the  said  Com- 
pany, to  be  worked  by  other  persons  outside  of  the 
said  Company,  etc.”  Such  is  the  bold'-faced  fashion 

36 


in  which  Japan  has  sought  to  control  China’s  biggest 
iron  and  steel  industry.  Such  is  the  time-honored 
tactics  with  which  Japan  has  repeatedly  browbeaten 
China. 

But  we  may  ask:  “How  does  it  happen  that  the 
Japanese  financiers  and  the  Hanyehping  Company 
have  close  relations?”  The  answer  is  another  revela- 
tion of  the  ingenuous  process  with  which  Japan  has 
attempted  to  secure  financial  domination  over  China 
with  the  one  hand,  and  to  grasp  economic  control  with 
the  other.  It  is  a process  of  political  chemistry  made 
possible  by  a combination  of  the  economical  and 
financial  elements.  The  Hanyehping  Company  used 
to  be  a private  concern  which  had  under  its  control 
the  Hanyang  Iron  Works  and  a number  of  coal  and 
iron  mines  in  the  neighborhood.  During  the  Revolu- 
tionary days  of  1911,  the  finance  of  the  Company  was 
in  such  stringent  straits  that  it  made  a loan  of  $10,000,- 
000  from  the  Yokahama  Specie  Bank.  For  the  in- 
terest of  the  loan,  the  Company  stipulated  to  pay  Japan 
13,000  tons  of  iron  ore  on  a fixed  price,  and  the  prop- 
erty of  the  Company  was  pledged  as  security.  It  was 
but  natural  that  it  should  have  fallen  into  Japan’s 
firm  grip. 

THE  MANCHURIAN  QUESTION 

The  next  thing  we  shall  consider  which  contrib- 
utes much  towards  Japan’s  economic  position  in 
China  is  the  subject  of  railway  development.  But 
in  considering  this  subject  we  cannot  detach  our- 
selves from  the  complicated  Manchurian  question, 
for  it  is  largely  in  Manchuria  where  Japan  has  a 
number  of  railways  under  her  control.  Of  course, 
the  Manchurian  question  itself  is  altogether  too 
complicated  to  be  treated  with  any  degree  of  clear- 


37 


ness  in  a limited  space.  In  taking  up  the  subject 
of  Japan’s  railway  enterprises  in  China  in  general 
and  in  Manchuria  in  particular,  however,  we  may 
hope  to  shed  some  lucid  light  on  the  general  situa- 
tion in  Manchuria  which  may  be  of  help  in  the  so- 
lution of  the  Chino-Japanese  question. 

It  has  been  said  again  and  again  that  Manchu- 
rian politics  is  largely  railway  politics,  and  in  this 
statement  we  can  certainly  find  more  than  a me- 
dium of  truth.  Of  course,  the  whole  problem  be- 
gan with  the  construction  of  the  Chinese  Eastern 
Railway  by  Russia,  which  was  the  culmination  of 
Russian  ambition  of  conquering  China  by  iron  and 
rail.  Through  years  of  political  and  diplomatic 
metamorphosis,  however,  the  present  Manchurian 
problem  is  no  longer  what  it  was  ten  or  twenty 
years  ago.  The  present  problem  is  almost  a Chino- 
Japanese  problem,  the  Russian  element  being  re- 
duced to  a negligible  quantity.  To  study  the  pres- 
ent railway  situation  in  Manchuria,  therefore,  one 
does  not  have  to  go  further  than  the  year  1905, 
when,  as  a defeated  party  in  the  war  and  as  a pen- 
alty for  it,  Russia  had  to  turn  over  to  Japan  what- 
ever economic  properties  and  commercial  conces- 
sions and  rights  she  had  extorted  from  China  in  South 
Manchuria. 

The  railways  acquired  by  Japan  from  Russia 
and  turned  over  to  the  South  Manchurian  Railway 
Company  were  many  in  number,  but  the  most  im- 
portant of  all  was  the  South  Manchurian  Railway, 
which  was  originally  a part  of  the  Chinese  Eastern 
Railway,  built  by  Russia  to  connect  the  Trans-Si- 
berian line  with  the  leased  ports  of  Dalny  and  Port 
Arthur.  By  Article  VI  of  the  Portsmouth  Treaty 
of  peace,  which  concluded  the  Russo-Japanese  war 
in  1905,  this  Russian  main  line  from  Changchun  to 

38 


Dalny,  with  all  its  properties,  including  coal  mines, 
which  were  formerly  owned  by  Russia,  passed  into 
the  hands  of  the  Japanese  Government.  In  the  fol- 
lowing year  the  South  Manchurian  Railway  Com- 
pany was  organized,  with  an  authorized  capital  of 
Yen  200,000,000  of  1,000,000  shares.  To  this  com- 
pany were  turned  over  the  branch  lines  of  several 
hundred  miles.  Besides  these  lines,  Japan  has 
been  granted  the  right  to  lay  five  other  railway 
lines  in  Manchuria  and  Mongolia.  Work  of  con- 
struction has  already  begun  in  1917  on  the  line  be- 
tween Chengchiatun  and  Ssipingtze  of  some  50 
miles,  while  that  on  the  Kaiyuan  Hailungcheng 
line,  Taonanfu  and  Jehol  line,  and  two  other  lines, 
will  soon  begin  too.  For  the  sake  of  convenience, 
we  can  divide  the  Manchurian  railways  into  three 
classes;  those  actually  under  Japanese  control, 
those  under  Japanese  influence,  and  those  which 
Japan  has  demanded  the  right  to  build.  To  the  first 
class  belong  the  South  Manchurian  Railway,  the 
Mukden-Antung  line,  the  Dalny-Port  Arthur  line, 
and  the  Suchiatun  line ; to  the  second  class  belong 
the  Kirin-Changchun  line,  the  Simmintun-Mukden 
line,  the  Ssipingtze  to  Chengchiatun  line ; and  to 
the  third  belong  those  lines  which  Japan  has  de- 
manded from  China  since  the  outbreak  of  the  war. 
There  are  many  other  lines  which,  because  of  the 
secrecy  that  has  been  maintained  about  them  by 
both  Governments,  cannot  be  given  with  any  de- 
gree of  accuracy. 

Even  the  most  casual  perusal  of  the  foregoing 
outline  will  bring  home  the  fact  that  the  whole  of 
South  Manchuria  has  speedily  been  enmeshed  in  a 
network  of  Japanese  railways.  There  is  no  doubt 
that  the  Japanese  have  in  their  hands  at  present  a 
perfected  system  of  railways,  which  comprises  the 

39 


lines  from  Port  Arthur  to  Dalny,  to  Mukden,  to 
Changchen,  to  Antung,  to  Kirin,  and  to  other  im- 
portant cities  in  Manchuria,  and  which  put  them  in 
a position  to  swallow  up  these  eastern  provinces 
at  any  convenient  time  they  may  choose.  In  no 
other  instance  does  it  seem  to  be  truer  that  “the 
path  of  Empire  is  along  the  railway  tracks.”  Stu- 
dents and  observers  of  Japan’s  economic  policy  and 
railway  enterprises  in  Manchuria  can  readily  see 
that  it  is  the  railways,  either  completed  or  in  the 
course  of  construction,  that  are  the  paths  of  Em- 
pire. They  are  the  new  weapons  of  a new  style 
of  foreign  invasion — a peaceful  invasion  which  can 
be  carried  on  without  bloodshed  and  without  the 
crude  and  costly  campaigns  of  warfare.  It  is  by 
means  of  these  railways  that  Japan  proposes  to 
carry  on  the  struggle  for  the  possession  of  the  coun- 
try, not  by  soldiers,  but  by  an  army  of  diplomatists, 
financiers,  engineers,  merchants,  travellers,  and  im- 
migrants. The  fact  that  these  railway  lines  are 
all  policed  by  Japan  and  the  fact  that  the  cities 
which  have  grown  up  in  the  railway  zone  are  all  un- 
der the  control  of  the  Japanese  Governor-General 
of  the  leased  territory,  have  made  the  Japanese 
position  in  Manchuria,  not  only  dominating,  but 
domineering. 

But  this  is  not  all.  On  August  i,  1917,  the 
South  Manchurian  Railway  was  merged  with  the 
Chosen  line.  The  Governor-General  of  the  Kwan- 
tung  leased  territory,  in  whose  hands  now  rests  the 
administrations  of  the  merged  lines,  commented  on 
the  drawing  together  of  the  Governments  of  Korea 
and  of  the  leased  territory  through  this  combina- 
tion. He  expressed  a fervent  hope  that  the  activi- 
ties of  the  Oriental  Colonization  Company  which 
was  organized  for  the  development  of  Korea  and 

40 


the  Bank  of  Chosen  which  has  already  established 
more  than  ten  branches  in  Manchuria  “will  also 
afford  fresh  bportunities  to  bring  south  Manchu- 
ria and  Chosen  to  a better  mutual  understanding.” 
No  one  who  is  at  all  acquainted  with  the  Manchur- 
ian situation  will  fail  to  understand  the  real  sig- 
nificance of  this  merging.  This  is  but  one  of  the 
decisive  and  incisive  steps  of  the  process  of  peaceful 
penetration  which  has  been  going  on  so  extensively 
in  China  in  general  and  so  intensively  in  Manchu- 
ria in  particular.  As  a result  of  the  diplomatic  ne- 
gotiations in  regard  to  the  twenty-one  demands 
which  Japan  had  served  upon  China  in  1915,  the 
term  of  the  lease  of  the  South  Manchurian  Rail- 
way and  the  Antung-Mukden  Railway  has  been  ex- 
tended to  a period  of  ninety-nine  years.  Thus  “the 
date  for  restoring  the  South  Manchurian  Railway 
to  China  shall  fall  due  in  the  91st  year  of  the  Re- 
public or  2002.  Article  XXI  in  the  Original  South 
Manchurian  Railway  Agreement  providing  that  it 
may  be  redeemed  by  China  after  36  years  from  the 
date  on  which  the  traffic  is  opened  is  hereby  can- 
celed. The  term  of  the  Antung-Mukden  Railway 
shall  expire  in  the  96th  year  of  the  Republic  or 
2007.”  What  a huge  mistake  the  Chinese  Govern- 
ment has  made  in  agreeing  to  these  preposterous 
demands,  and  yet  what  a clever  stroke  of  pen  it  is 
by  which  Japan  has  virtually  constituted  herself 
the  master  of  South  Manchuria ! Even  the  merest 
tyro  of  international  politics  can  see  without  the 
least  danger  of  being  mistaken  the  deliberate, 
methodical,  and  step-by-step  manner  in  which 
Japan  has  carried  on  her  campaign  of  penetration. 
This  fact  is  attested  by  those  astute  measures  which 
Japan  has  adopted  in  South  Manchuria  and  which 
have  already  been  patent  to  the  outside  world.  In- 


41 


teresting  as  the  subject  is,  we  regret  that  we  have 
not  sufficient  time  or  space  to  go  into  the  details 
of  the  matter.  However,  it  will  be  sufficient  to  say 
that,  by  making  all  Japanese  consuls  and  railway 
employes  subject  to  the  direct  control  of  the  Gov- 
ernor-General of  the  Kwantung  leased  territory, 
Japan  has  meant,  and  succeeded  too,  to  establish 
the  web  of  administration  in  South  Manchuria;  by 
extending  policing  rights  wherever  the  new  Japan- 
ese controlled  and  Japanese  financed  (which  is  the 
same  thing)  railways  may  go,  Japan  has  manipu- 
lated to  put  South  Manchuria  virtually  under  Jap- 
anese control ; by  linking  together  the  various 
railways  betwen  Korea  and  Manchuria,  Japan  has 
sought  to  obliterate  the  territorial  difference  between 
the  two  countries;  and  by  unfair  means  of  discrimi- 
nation, such  as  railway  rebates,  government  sub- 
sidies, and  preferential  duties,  Japan  has  attained 
a position  of  commercial  supremacy  and  has  sought 
to  control  the  economic  resources  of  Manchuria. 
Her  present  position  is  that  of  a virtual  master;  her 
grip  is  tight,  and  her  policy  is  not  only  aggressive 
but  also  exclusive.  It  is  for  China  to  wake  up  to 
the  danger  that  has  been  menacing  her  territorial 
sovereignty,  and  it  is  for  the  United  States  and 
other  Powers  who  have  so  gallantly  championed 
the  rights  of  weak  nations  to  see  that  after  one 
Prussia  has  been  crushed  in  Europe  no  other  should 
be  allowed  to  arise  in  the  Far  East. 

As  to  what  Japan  has  been  doing  in  Manchuria 
in  other  respects  than  economic  and  how  the  Jap- 
anese people  have  been  behaving  themselves  in  a 
foreign  land,  we  can  find  no  better  description  or 
information  than  what  was  told  us  by  the  Earl  of 
Ronaldshay,  who  was  in  1907  an  eye-witness  of 
Japanese  conduct  in  Manchuria.  What  was  true 

42 


in  1907  is  still  true  to-day.  “And  it  was  here,” 
wrote  the  Earl  in  his  book  A Wandering  Student  in 
the  Far  East,  “that  I began  to  find  solid  foundations 
for  a growing  feeling  of  irritation  against  Japan. 
In  Manchuria,  as  in  Korea,  the  military  element 
was  undoubtedly  guilty  of  aggressive  and  arbitrary 
behavior.  Land  was  appropriated  without  adequate 
payment;  buildings  were  taken  and  the  rents  left 
unpaid ; the  reasonable  representations  of  the  Chi- 
nese authorities  were  scouted  and  ignored.  A swarm 
of  Japanese  ne’er-do-wells  had  hit  like  a flight  of 
locusts  upon  the  land,  a host  of  shameless  courte- 
sans plied  their  trade  in  .the  open  market  in  the 
broad  light  of  the  day.  Dishonesty  in  trade,  the  arbi- 
trary appropriation  of  property  without  adequate 
payment,  the  shameless  flaunting  of  vice  in  the 
streets, — all  these  things  are  cardinal  sins  in  the 
eyes  of  the  Chinese.”  And  so  they  are.  Who  will 
consider  them  not?  No  civilized  people  will  take 
them  as  matters  of  indifference  as  the  Japanese  do. 

But  we  shall  be  greatly  mistaken  if  Ave  think 
that  Japan’s  railway  activities  are  confined  to  Man- 
churia. Latest  revelations  about  Chino-Japanese 
secret  agreements  which  have  been  entered  into  be- 
tween these  two  countries  during  the  four  years 
of  the  World  War  are  such  as  to  warrant  the  belief 
that  Japan  has  been  attempting  to  get  control  of 
China’s  railway  development,  in  disregard  of  or  to 
the  exclusion  of  all  American  and  European  inter- 
ests. The  demands  of  1915  point  in  that  direction; 
and  the  secret  agreements  concluded  during  the  war 
confirm  this  belief.  To  give  but  one  instance,  we  beg 
to  refer  to  the  Chino-Japanese  notes  exchanged  on 
September  24,  1918.  The  number  of  railways  which 
Japan  has  extorted  from  China  is  so  large,  and  the 
terms  of  the  agreements  are  so  inclusive  that  if 


43 


they  are  carried  out  there  will  be  no  escaping  for 
China  from  the  assigned  position  of  a Japanese 
dependency.  It  is  fruitless  for  us  to  call  for  help 
when  there  is  none  in  sight,  but  it  will  not  be  hope- 
less for  us  to  believe  that  at  the  peace  conference 
justice  will  take  its  due  course.  In  order  to  show 
where  the  American  public  opinion  stands  on  this 
matter,  we  beg  to  quote  an  editorial  of  The  New  York 
Herald  of  February  27,  1919,  which  comments  on  the 
Chino-Japanese  secret  agreements  in  the  following 
language : “The  secrets  of  the  differences  between 
China  and  Japan,  now  brought  before  the  peace  con- 
gress in  Paris  for  settlement,  lies  in  the  agreements 
made  last  year  by  which  China  under  pressure  con- 
sented to  allow  Japan  to  build  railway  extensions 
in  Shantung,  Mongolia  and  Manchuria  and, 
financing  them  with  loans,  practically  to  control 
them.  Other  foreign  capital  would  be  excluded 
and  Japan  would  thus  dominate  the  trade  of  the 
most  densely  populated  region  of  the  globe. 

“Whoever  owns  the  railroads  owns  the  com- 
merce which  must  use  the  railroads.  They  can 
make  or  break  whole  communities.  Hence  the  Jap- 
anese would  exercise  virtual  sovereignty  over  large 
portions  of  China  and  could  prevent  investments 
of  capital  by  the  Chinese  themselves  or  by  foreign 
corporations  or  governments.  An  inkling  of  this 
was  shown  in  the  protest  against  a contract  awarded 
by  China  to  the  Siems-Carey  Company  in  this  coun- 
try nearly  two  years  ago,  which  was  said  to  con- 
travene some  prior  engagements  by  China. 

“Now,  these  agreements  with  Japan  have  not 
yet  been  ratified  and  China  is  protesting  against 
their  enforcement,  preferring  the  internationaliza- 
tion of  all  her  railways  rather  than  that  they  come 
under  the  exclusive  control  of  her  formidable 


44 


neighbor.  This,  too,  is  said  to  be  the  position  of 
the  foreign  legations. 

“In  return  for  railway  control  Japan  is  willing 
to  concentrate  her  troops  at  Tsingtao  and  with- 
draw from  the  civil  administration  of  the  district 
of  Kiaochau,  the  former  German  colony  which  the 
Japanese  captured  with  the  asistance  of  British 
troops.  China  wants  her  to  get  out  altogether  and 
recalls  the  fact  that  when  Japan  summoned  Ger- 
many to  surrender  the  territory  it  was  'with  a view 
to  its  eventual  restoration  to  China.’  Meanwhile 
the  Japanese  have  invested  large  sums  in  the  coun- 
try. This  is  only  a sample  of  some  of  the  less  in- 
tricate problems  that  the  peace  congress  will  have 
to  settle.” 

In  connection  with  the  Manchurian  question,  we 
must  not  fail  to  notice  one  important  fact  that  Man- 
churia has  been  transformed  by  Japan  into  an  igno- 
minious centre  of  Japan’s  opium  and  morphine  traffic 
in  China.  The  reason  that  lies  behind  this  transfor- 
mation is  very  simple.  From  the  pecuniary  stand- 
point of  view  opium  and  morphine  and  other  nar- 
cotic drugs  form  the  most  lucrative  trade  in  China 
as  elsewhere.  People  who  have  had  the  habit  of 
using  those  drugs  will  buy  them  at  any  price,  and 
the  price  is  increased  hundredfold  when  their  sale  is 
prohibited  by  law.  Under  the  protection  of  extra- 
territoriality, however,  Japanese  tradesmen  in  Man- 
churia carry  on  their  opium  and  morphine  traffic 
without  the  least  molestation.  The  native  Chinese 
are  also  induced  to  the  trade  by  its  huge  profit,  and 
by  a false  protection  which  the  Japanese  consuls  in 
Manchurian  ports  are  only  too  willing  to  furnish  in 
the  shape  of  a “citizen  certificate.”  Not  infre- 
quently, therefore,  the  native  Chinese  who  are 


45 


caught  in  this  illegitimate  traffic  seek  to  avoid  the 
punishment  by  producing  the  talismanic  proof  which 
certifies  them  either  as  Formasans,  Koreans,  or  as 
Japanese.  In  face  of  such  a situation,  the  Chinese 
Government  has  no  choice  but  to  turn  them  over  to 
the  nearest  Japanese  consul  for  punishment  which 
consists  in  setting  them  free  so  that  they  may  en- 
gage in  the  trade  again ! And  from  the  geographi- 
cal point  of  view,  Manchuria  is  not  only  the  next- 
door  neighbor  to  Korea,  but  also  Japan’s  strongest 
foothold  in  China  by  virtue  of  the  Kwantung  leased 
territory.  The  gate  of  entrance  is,  therefore,  widely 
open  to  the  Japanese  who  care  to  enter,  and  ninety- 
nine  per  cent,  of  those  who  do  enter  belong  to  the 
slums  of  Osaki,  Tokio,  and  the  never-do-well  class. 
They  are  directly  encouraged  by  their  authorities  to 
engage  in  this  sort  of  illicit  trade  so  that  they  can 
easily  make  a living.  Their  activity  is  first  centered 
in  Manchuria;  but  with  the  extending  of  Japan’s  po- 
litical spheres  of  influence  into  Fukien  and  Shan- 
tung Provinces  the  morphine  traffic  has  spread  to  all 
parts  of  China.  In  order  to  give  an  accurate  descrip- 
tion of  the  ways  and  means  with  which  Japan  has 
• clandestinely  carried  on  the  morphine  and  opium 
traffic  throughout  China  we  reproduce  here  a sum- 
mary which  was  first  published  in  The  North  China 
Daily  News,  republished  in  The  New  York  Times, 
and  quoted  in  The  Oriental  News  and  Comment: 

“Morphia  can  no  longer  be  purchased  in  Europe. 
The  seat  of  the  industry  has  been  transferred  to 
Japan,  and  morphia  is  now  manufactured  by  the 
Japanese  themselves.  Literally  tens  of  millions  of 
yen  are  transferred  annually  from  China  to  Japan 
for  the  payment  of  Japanese  morphia. 

“The  chief  agency  in  the  distribution  of  morphia 
46 


in  China  is  the  Japanese  post-office.  Morphia  is  im- 
ported by  parcels  post.  No  inspection  of  parcels  in 
the  Japanese  postoffices  in  China  is  permitted  to  the 
Chinese  Customs  Service.  The  service  is  only  al- 
lowed to  know  what  are.  the  alleged  contents  of  the 
postal  packages,  as  stated  in  the  Japanese  invoices. 
Yet  morphia  enters  China  by  this  channel  by  the 
ton.  A conservative  estimate  would  place  the 
amount  imported  by  the  Japanese  into  China  in  the 
course  of  a year  as  high  as  eighteen  tons,  and  there 
is  evidence  that  the  amount  is  steadily  increasing. 

“In  South  China  morphia  is  sold  by  Chinese  ped- 
dlers, each  of  whom  carries  a passport  certifying  that 
he  is  a native  of  the  Island  of  Formosa  and  therefore 
entitled  to  Japanese  protection.  Japanese  drug 
stores  throughout  China  carry  large  stocks  of  mor- 
phia. Japanese  medicine  vendors  look  to  morphia 
for  their  largest  profits.  Wherever  Japanese  are  pre- 
dominant there  the  trade  flourishes.  Through  Tai- 
ren  morphia  circulates  throughout  Manchuria  and 
the  province  adjoining;  through  Tsingtao  morphia 
is  distributed  over  Shantung  province,  Anhui  and 
Kiangsu;  while  from  Formosa  morphia  is  car- 
ried with  opium  and  other  contraband  by  mo- 
tor-driven fishing  boats  to  some  point  on  the  main- 
land, from  which  it  is  distributed  throughout  the 
province  of  Fukien  and  the  north  of  Kuangtung. 
Everywhere  it  is  sold  by  Japanese  under  exter- 
ritorial protection. 

“While  the  morphia  traffic  is  large  there  is  ev- 
ery reason  to  believe  that  the  opium  traffic,  upon 
which  Japan  is  embarking  with  enthusiasm,  is  likely 
to  prove  even  more  lucrative.  In  the  Calcutta  opium 
sales  Japan  has  become  one  of  the  considerable  pur- 
chasers of  Indian  opium.  She  purchases  for  For- 


47 


mosa,  where  the  opium  trade  shows  a steady  growth 
and  where  opium  is  required  for  the  manufacture  of 
morphia.  Sold  by  the  Government  of  India,  this 
opium  is  exported  under  permits  applied  for  by  the 
Japanese  Government,  is  shipped  to  Kobe,  and  from 
Kobe  is  transshipped  to  Tsingtao.  Large  profits 
are  being  made  in  this  trade,  in  which  are  interested 
some  of  the  leading  firms'  of  Japan. 

“It  must  be  emphasized  that  this  opium  is  not 
imported  into  Japan.  It  is  transshipped  in  Kobe 
Harbor,  from  which  point,  assisted  by  the  Japanese 
controlled  railway  to  Tsinanfu,  it  is  smuggled 
through  Shantung  into  Shanghai  and  the  Yangtze 
Valley.  This  opium  is  sold  in  Shanghai  at  $500  a ball, 
forty  balls  to  the  chest,  a total  valuation  of  about 
S20,ooo  a chest.  China’s  failure  to  sell  ‘for  medici- 
nal purposes’  her  opium  at  $27,000  a chest,  the  price 
asked  by  the  opium  ring,  is  thus  explained.  The 
price  is  undercut  by  the  Japanese.  There  is  reason 
to  believe  that  between  January  i and  September  30, 
[QtS,  not  less  than  200  chests  of  opium  purchased  in 
India  were  imported  into  Tsingtao  through  Kobe. 

“Upon  this  amount  the  Japanese  authorities  levy 
a tax,  which  does  not  appear  in  the  estimates,  equiv- 
alent to  Tls.  4,000  a chest,  a total  for  the  2,000  chests 
at  the  present  rate  of  exchange  of  $10,000,000.  The 
acquisition  of  this  immense  profit  from  a contra- 
band traffic  would  explain  the  origin  of  those  im- 
mense sums  now  being  lavished  upon  the  develop- 
ment of  Tsingtao  and  the  establishment  there  of 
Japanese  commercial  supremacy. 

“It  may  be  asked  how  it  is  possible  that  at  Tai- 
ren,  where  the  morphia  traffic  is  greatest,  and  at 
Tsingtao,  which  is  the  chief  center  of  the  Japanese 
opium  trade,  the  importation  of  this  contraband  con- 

48 


tinues  without  the  knowledge  of  the  Chinese  Mari- 
time Customs.  At  both  Dalny  and  Tsingtao  these 
offices  are  wholly  under  the  control  of  the  Japanese 
and  wholly  manned  by  them.  Japanese  military 
domination  would  forbid  in  both  ports  any  interfer- 
ence in  a traffic  in  which  the  Japanese  authorities 
were  interested  either  officially  or  unofficially.  In 
Dalny  the  highest  civic  dignity  has  been  conferred 
upon  the  chief  dealer  in  morphia  and  opium. 

“Moreover,  in  the  case  of  Tsingtao,  by  the  agree- 
ment which  relinquished  to  Japanese  the  exclusive 
charge  of  the  Chinese  Maritime  Customs,  any  trade 
in  which  the  government  is  interested,  contraband 
or  not,  can  be  carried  on  without  the  official  knowl- 
edge of  the  customs.  Article  3 of  the.  Agreement  of 
December  2,  1905,  perpetuated  in  the  agreement  of 
August  6,  1915,  provides  that  any  goods  landed  in 
Tsingtao  under  ‘certificates  of  government’  shall  be 
free  .from  customs  examination.  The  way  has  thus 
been  opened,  not  only  for  the  illegal  import  of 
opium,  but  of  contraband  in  arms. 

“The  Maritime  Customs  returns  of  1917  show 
that  forty-five  piculs  of  boiled  opium  were  admitted 
to  Tsingtao  in  1917,  but  the  actual  amount  probably 
was  fifty  times  greater.  The  balance  enters  in  cases 
stamped  ‘chun  pung  pin’  meaning  ‘military  stores,’ 
and  boxes  so  stamped  are  to  be  seen  commonly  in 
the  Japanese  drug  stores  along  the  Shantung  Rail- 
way. 

“In  1917  morphia  to  the  amount  of  nearly  two 
tons  is  recorded  as  having  entered  Tairen  for  use  in 
the  leased  territory,  but  no  morphia  is  recorded  as 
having  entered  Manchuria  from  the  leased  territory 
during  the  year,  nor  does  any  entry  of  morphia  ap- 
pear in  the  Tsingtao  customs  returns  for  1917.  Yet 


49 


a competent  witness,  Dr.  Wu  Lien-teh,  states  that 
‘almost  every  Japanese  drug  dealer  or  peddler  in 
Manchuria  sells  morphia  in  one  form  or  another,  and 
does  so  with  impunity,  because  no  Japanese  can  be 
arrested  without  first  informing  the  consul.” 

It  is  thus  evident  that  Japan  is  not  only  seeking 
economic  domination  over  China  but  also  social  de- 
generation of  the  Chinese  people.  China  has  just 
fought  one  of  the  most  heroic  battles  in  suppressing 
the  age-long  habit  of  opium  smoking,  and  while  one 
curse  is  yet  hardly  disposed  of,  Japan  is  substituting 
in  its  place  another  that  is  infinitely  worse.  We  do 
not  wish  to  dilate  on  the  subject;  but  we  must  point 
out  that  in  either  encouraging  or  acquiescing  in  this 
morphia  and  opium  traffic,  Japan  is  not  only  abusing 
the  privilege  of  extraterritoriality  which  her  nationals 
enjoy  in  China,  not  only  violating  the  Opium  Conven- 
tion of  1909  to  which  Japan  is  a signatory,  not  only 
corrupting  the  Chinese  people  in  the  most  vicious 
way,  but  also  committing  an  outrage  against  the  moral 
law  of  the  entire  civilized  world.  Unless  Japan  is 
morally  bankrupt,  unless  the  Japanese  people  can  not 
do  better,  we  must  insist  that  this  vicious  and  illicit 
traffic  should  be  stopped.  The  well-being  of  the  Chin- 
ese people  demands  it;  the  moral  sense  of  the  entire 
civilized  world  demands  it.  The  case  is  not  one  be- 
tween China  and  Japan  alone ; it  is  one  between  the 
civilized  world  on  the  one  hand  and  Japan  or  the 
Japanese  Government  on  the  other. 

JAPAN’S  POLITICAL  SCHEMES 

It  may  be  asked  how  Japan  has  come  to  wield 
such  a sinister  influence  over  China?  How  could 
China  as  a sovereign  state  yield  so  much  that  is 


totally  incompatible  with  her  own  rights  of  exist- 
ence? The  Europeans  and  very  likely  the  major- 
ity of  the  Americans  might  be  inclined  to  think 
that  the  Chinese  Government  is  as  pliant  as  a gold 
wire  and  the  Chinese  people  are  as  soft  as  wax,  so 
that  in  the  hands  of  the  Japanese,  they  can  be 
moulded  in  whichever  way  that  will  serve  the  pur- 
pose of  the  Japanese  Government.  This  is  what 
the  followers  of  the  Darwinian  theory  would  call 
“non-resistible,”  but  it  is  an  entirely  erroneous 
conception.  The  Chinese  people  are  just  as  honor- 
able, as  self-respecting,  and  as  country-loving  as 
any  other  people  in  the  world,  and  to  insinuate  as 
if  they  were  made  of  clay  will  be  a great  perver- 
sion of  justice.  We  know  that  there  are  times 
when  nations,  like  individuals,  have  to  yield  before 
force  majeure  what  is  most  valuable  and  dearest  to 
them.  Confronted  with  a highwayman  in  a narrow 
pass  even  in  broad  daylight,  with  a pistol  pointing 
at  your  head  and  saying  “Give  me  your  money  or 
your  life,”  the  moment  left  for  deliberation  is  short 
and  the  choice  is  too  apparent.  Of  course,  there 
are  a number  of  reasons  why  Japan  has  held  such 
a predominant  position  in  the  Far  East  and  why 
she  has  attained  such  a domineering  position  in 
China.  Geographical  situation  accounts  for  it  in 
the  first  place,  and  her  naval  and  military  strength 
is  the  real  thing  that  backs  her  up  in  all  her  diplo- 
matic movements  in  China.  These  are  factors 
which  are  patent  to  the  outside  world,  and  to  re- 
capitulate them  will  be  merely  wasting  time.  There 
are,  however,  other  factors  which  are  not  gener- 
ally known  to  the  world  and  which-Jor  want  of  a 
better  name  we  call  “Japan’s  political  schemes.” 
It  is  on  these  schemes  that  we  shall  endeavor  to 
shed  a beam  of  light  so  that  the  world  may  learn 


51 


the  clever  and  ingenious  designs  which  Japan  has 
employed  in  undermining  China. 

In  December,  1916,  Japan  carried  out  one  of 
her  pet  schemes  by  launching  a dastardly  attack 
upon  the  sovereignty  of  China  (We  are  now  giving 
concrete  examples  instead  of  generalising  what 
Japan  has  done).  The  tactics  Japan  employed  was 
nothing  but  usual.  In  the  city  of  Amoy,  Japan  es- 
tablished a police-station  without  the  knowledge  or 
permission  of  the  Chinese  Government.  Japan  at- 
tempted to  justify  her  action  on  the  ground  that 
Amoy  was  a treaty  port  where  a large  number  of 
Japanese  and  Formosan  subjects  resided  and  that 
the  police-station  was  established  in  order  to  con- 
trol her  nationals  more  effectively  the  same 
old  argument  which  has  been  repeatedly  advanced 
by  the  Japanese  Government  in  similar  assaults  else- 
where. Never  mind  what  the  Japanese  Government 
might  say — in  such  and  similar  cases  Japan  has  al- 
ways a good  deal  to  say,  the  grim  fact  remains.  The 
establishment  of  a police-station  in  a Chinese  city 
by  the  Japanese,  in  Amoy  or  elsewhere,  is  a distinct 
breach  of  China’s  sovereignty,  pure  and  simple. 
Amoy  is  a treaty  port,  indeed ; but  foreign  trade 
and  residence  has  been  restricted  in  Amoy  as  in 
Shanghai,  Hankow,  and  other  treaty  ports  in  China, 
both  in  theory  and  in  practice,  to  special  demarcated 
areas.  If  Japan  could  establish  a police-station 
there  in  order  to  control  her  nationals  more  effec- 
tively, there  is  nothing  that  could  prevent  the  other 
treaty  powers  from  doing  the  same  thing.  It  is 
difficult  to  understand  why  Japan  should  engineer 
such  a scher^e,  at  all.  “The  new  Chinese  police 
which  are  being  distributed  in  ever  greater  numbers 
throughout  China  form  an  admirable  force  and  are 
superior  to  Japanese  police  in  the  performance  of 

52 


nearly  all  their  duties.  It  is  monstrous  that  Japan 

, should  act  in  such  a reprehensible  manner 

when  the  Chinese  administration  is  doing  all  it  can 
to  provide  efficient  guardians  of  peace.” 

But  this  is  not  the  only  incident.  That  Japan 
has  persistently  sought  to  usurp  China’s  jurisdic- 
tional rights  is  attested  by  a number  of  untoward 
acts  of  similar  nature.  The  one  that  has  become  so 
notorious  of  all  is  the  Chengchiatun  fracas.  The 
facts  about  the  whole  incidentare  increditably  simple. 
Chengchiatun  is  a small  Mongolian-Manchurian 
market  town,  lying  some  sixty  miles  west  of  the 
South  Manchurian  Railway.  In  spite  of  the  fact 
that  it  is  not  open  to  foreign  residence  or  trade,  the 
Japanese  have  established  a small  trading  commun- 
ity there.  On  the  13th  of  August,  1916,  a Chinese 
boy  selling  fish  was  approached  by  a Japanese  who 
wanted  to  buy  the  fish  at  his  own  price.  On  the 
boy  refusing  to  sell  at  the  price  offered  him,  the 
Japanese  got  hold  of  him  and  beat  him  with  the  help 
of  a Japanese  police  officer.  It  was  precisely  in  this 
way  that  the  incident,  trifling  in  itself,  brought 
about  an  armed  conflict -between  the  Cffinese  on  the 
one  side  and  the  Japanese  soldiers  on  the  other. 
Without  entering  into  the  merits  of  the  case,  the 
Japanese  Government  at  once  made  a series  of  de- 
mands upon  China.  They  included  among  other 
things  (i)  the  stationing  of  Japanese  police  officers 
in  places  in  South  Manchuria  and  Eastern  Inner 
Mongolia  (2)  employment  of  a certain  number  of 
Japanese  military  officers  as  instructors  in  Chinese 
military  schools.  The  merest  tyro  of  the  Chino- 
Japanese  question  can  see  at  once  that  Japan  was 
bent  upon  gaining  new  rights  and  new  privileges 
regardless  of  what  foul  means  she  might  employ.  To 
understand  the  case  completely,  however,  it  is  neces- 

53 


sary  to  remember  that  Chengchiatun  is  and  never 
has  been  open  to  foreign  trade  or  residence,  that 
Japan  has  no  moral  or  legal  right  to  station  police 
officers  there,  and  that  Japan  is  violating  China’s 
territorial  integrity  by  placing  Japanese  soldiers  in 
an  inland  city  without  the  permission  or  knowledge 
of  the  Chinese  Government.  The  whole  incident 
was,  however,  nominally  closed  in  January,  1917, 
by  China  acceding  to  some  of  the  outrageous  de- 
mands which  no  other  government  would  considei 
for  a moment.  But  according  to  Putnam  Weale, 
the  wound  has  not  yet  been  healed.  “The  question 
of  Japanese  police  rights  in  South  Manchuria  and 
Eastern  Inner  Mongolia  was  left  precisely  where  it 
had  been  before,  the  most  vigorous  Chinese  pro- 
tests not  having  induced  Japan  to  abate  in  the 
slightest  her  pretensions.  During  previous  years 
a number  of  Japanese  police-stations  and  police- 
boxes  had  been  established  in  defiance  of  the  local 
authorities  in  these  regions,  and  although  China  in 
these  negotiations  recorded  her  strongest  possible 
objection  to  their  presence  as  being  the  principal 
cause  of  the  continual  frictibn  between  Chinese  and 
Japanese,  Japan  refused  to  withdraw  from  her  con- 
tention that  they  did  not  constitute  any  extension 
of  the  principle  of  extraterritoriality,  and  that  in- 
deed Japanese  police,  distributed  at  such  points  as 
the  Japanese  consular  authorities  considered  neces- 
sary, must  be  permanently  accepted.  Here  then 
is  a matter  which  will  require  careful  consideration 
when  the  Powers  meet  to  revise  their  Chinese  treat- 
ies as  they  must  revise  them  after  the  war.” 

Next  to  the  demanding  and  usurpation  of 
China’s  sovereign  right  of  establishing  police  forces, 
we  should  consider  Japan’s  attempt  to  make  China 
employ  Japanese  advisors  as  the  cleverest  trick. 


54 


Of  course,  advisors  are  of  different  kinds,  and  bear- 
ing different  titles,  financial,  political,  legal,  consti- 
tutional, military,  and  what  not.  But  they  all  serve 
only  one  purpose.  They  are  all  employed  and  paid 
for  by  the  Chinese  Government,  yes,  but  whom  do 
they  serve?  They  do  not  advise  the  Chinese  Govern- 
ment by  whieh  they  are  thus  employed  as  advisors; 
they  advise  the  Japanese  Government.  Just  one  in- 
stance to  make  the  statement  clear.  One  Fushihara 
was  appointed  by  the  Chinese  Government  to  the 
Bank  of  Communications  early  in  1918.  What  did 
he  do?  Instead  of  advising  the  Bank  in  the  mat- 
ters of  reform  and  improvement,  he  assisted  Nishi- 
hara,  a Japanese  secret  agent  (of  whom  more  anon) 
in  his  nefarious  plottings  of  plunging  China  into 
financial  serfdom.  Fushihara  often  acted  as  a go- 
between  in  financial  dealings  between  the  Prime 
Minister  of  Japan  and  a clique  of  Chinese  officials; 
he  acted  as  the  handmaid  of  the  Japanese  secret 
agent,  initiating  him  to  the  official  byways  which 
were  yet  unknown  to  the  new  arrival ; at  one  time, 
Fushihara  was  even  charged  of  being  Japan’s 
financial  spy,  having  from  time  to  time  supplied 
his  master.  Count  Terauchi,  with  all  the  information 
concerning  China’s  financial  schemes  in  general  and 
the  credit  of  the  Bank  of  Communication  in  par- 
ticular. 

In  the  case  of  Dr.  Ariga,  another  Japanese  ad- 
visor to  the  Chinese  Government,  we  notice  a differ- 
ent trick  used,  more  subtle  and  yet  far  more  sin- 
ister than  anything  that  a mere  spy  can  bring  about. 
He  gave  advice  freely.  His  advice  is  however,  not 
wise,  but  otherwise.  It  was  this  learned  doctor  who 
advised  Yuan  Shih-Kai  that  a monarchical  govern- 
ment was  better  suited  to  China;  it  was  the  same 
learned  doctor  who  was  among  the  first  to  acknowl- 

55 


edge  Yuan  as  the  Emperor  of  a new  dynasty;  and 
it  was  he  who  advised  Li-yuan-hung  to  dissolve 
the  Parliament  as  a matter  of  expediency.  Advice 
is  cheap,  as  the  proverb  goes ; but  cheap  advice  is 
yet  better  than  ill-advice  which  is  the  only  sort  of 
advice  that  the  Japanese  legal  advisor  to  the  Chi- 
nese Government  can  give.  Here  is  the  judgement 
and  opinion  of  a trained  journalist  who  was  a resi- 
dent in  China  when  these  dramatic  events  took 
place.  Apropos  of  the  question  of  advisors,  Putnam 
Weale  has  this  to  say:  “Thus  Dr.  Ariga,  the  consti- 
tutional expert,  when  called  in  at  the  last  moment 
for  advice  by  President  Lo-Yuan-hung,  had  flatly 
contradicted  by  Dr.  Morrison,  who  with  an  English- 
^ man’s  love  of  justice  and  constitutionalism  had  in- 
sisted that  there  was  only  one  thing  for  the  Presi- 
dent to  do — to  be  bound  by  legality  to  the  last  no 
matter  what  it  might  cost  him.  Dr.  Ariga  had 
falsely  stated  that  the  issue  was  a question  of  ex- 
pediency, thus  deliberately  assisting  the  forces  of 
disruption.  This  is  perhaps  only  what  was  to  be 
expected  of  a man  who  had  advised  Yuan  Shih-Kai 
to  make  himself  Emperor — knowing  full  well  that 
he  could  never  succeed  and  that  indeed  the  whole 
enterprise  from  the  point  of  view  of  Japan  was  an 
elaborate  trap.” 

The  question  naturally  arises:  why  should  the 
Chinese  Government  appoint  any  Japanese  advisors 
at  all,  if  such  have  been  their  services?  The  answer 
is  simple  enough.  In  nine  cases  out  of  ten,  Jap- 
anese advisors  are  imposed  upon  the  Chinese  Gov- 
ernment. They  are  appointed,  not  because  that 
China  needs  them,  but  because,  euphemistically 
speaking,  they  need  China.  To  be  more  specific, 
Japan  is  behind  every  appointment  of  her  nationals 
to  important  financial,  political,  and  military  posi- 

56 


tions  in  China,  and  through  these  advisors,  Japan 
hopes  to  make  a dependency  out  of  China.  We  can- 
not go  into  the  diplomatic  background  of  all  the 
appointments  of  Japanese  advisors,  but  the  trick 
by  which  China  was  forced  to  appoint  Dr.  Sakatani 
as  financial  advisor  is  most  interesting,  most  ingen- 
ious and  most  typical,  and  one  that  we  cannot  afford 
to  leave  in  darkness. 

Before  his  coming  to  China,  Dr.  Sakatani  started 
a rumor,  in  the  nature  of  a personal  press  campaign, 
that  he  was  going  to  be  appointed  as  the  financial 
advisor.  This  newspaper  publicity  heralded  his 
coming  and  prepared  the  public  mind  for  what  was 
to  come.  He  traveled  in  China  from  north  to 
south,  giving  interviews  to  newspaper  reporters 
everywhere  he  landed,  setting  forth  his  learned 
views  as  to  the  needs  of  China’s  financial  reform  and 
the  ways  and  means  of  carrying  it  out.  In  spite  of 
this  press  campaign  and  the  exposition  of  his  pro- 
found knowledge  on  financial  matters,  the  Chinese 
Government  never  dreamed  of  offering  him  such  a 
iob  as  the  learned  doctor  had  planned  out  for  himself. 
The  Chinese  Government  remained  cold  and  firm, 
being  afraid  that  Dr.  Sakatani  was  but  another  of 
those  secret  agents  or  spy-advisors  of  the  Japanese 
Government  who  are  the  forerunners  of  the  battal- 
ion that  seeks  the  undoing  of  China.  But  here  the 
trick  commenced  to  work,  as  everything  else  had 
failed.  It  consisted  in  arranging  a provincial  loan, 
with  a Governor,  then  withdrawing  it  at  the  last 
moment,  leaving  the  Governor  to  discover  that  it 
was  the  refusal  of  the  Central  Government  to  ap- 
point a Japanese  financial  advisor  which  had  really 
brought  about  the  deadlock.  In  order  to  get  the 
money  necessary  to  pay  off  the  provincial  soldiers 
and  to  maintain  peace  and  order  in  the  province,  it 

57 


is  but  natural  that  the  Governor  should  bring  pres- 
sure to  bear  on  the  Central  Government  for  remov- 
ing the  obstacle  by  complying  with  the  appointment 
desired.  Here  is  a typical  instance.  “General  Lung 
Chi-kwang,  Inspecting  Commissioner  of  Kwantung 
and  Kwangsi,  who  is  trying  to  hold  the  former 
province  (during  the  recent  revolution)  for  the 
Government  wanted  to  make  a loan  of  $400,000 
from  the  Yokahama  Specie  Bank,  with  $2,000,000 
first  year  bonds  as  security.  On  Thursday  (May 
18,  1918)  the  Peking  Government,  anxious  for  the 
loyalty  of  the  province,  approved  of  the  loan.  All 
the  details  of  the  loan  were  subsequently  arranged. 
But  on  Friday  afternoon.  May  19,  the  Yokahama 
Specie  Bank  received  a telegram  from  its  headquar- 
ters in  Tokio  stating  that  in  future  no  money  should 
be  lent  to  China  for  fighting  purposes.  Other  loans 
for  fighting  purposes  are  however  being  negotiated, 
but  objection  is  raised  to  this  one.  And 'why?  Gen- 
eral Lung  is  an  important  figure  in  Kwantung,  and 
his  loyalty  must  be  retained  by  all  means.  Japan’s 
refusal  to  lend  him  money  will  send  him  in  quest  of 
reasons,  and  when  he  is  told  by  a Japanese  friend 
that  it  is  a question  of  the  employment  of  merely  a 
Japanese  financial  advisor,  he  will  bring  sufficient 
pressure  to  bear  upon  the  Peking  Government  and 
secure  for  Dr.  Sakatani  the  appointment  so  that  his 
]oan  can  be  concluded.”  And  so  he  did! 

Another  political  method  which  Japan  has 
adopted  in  her  dealings  with  China  is  the  sending 
of  Japanese  secret  agents.  They  may  be  financial, 
military,  naval,  or  commercial  in  character,  each 
being  an  expert  along  a special  line.  Their  presence 
in  the  Chinese  communities  and  among  the  politi- 
cal circles  can  be  felt,  not  seen.  Or,  in  better 
language,  their  influence  is  felt  more  keenly  than 

58 


their  presence.  Instances  afe  so  numerous  that  to 
give  them  all  would  require  considerable  length, 
but  the  latest  specimen  of  a political  monster  of  this 
type  is  found  in  the  person  of  one  Nishihara  who  is 
said  to  be  one-time  director  of  the  Chosen  Bank. 
Nishihara — the  name  itself  makes  one  smell  a rat — 
is  one  of  several  secret  agents  sent  to  China  by 
Count  Terauchi  during  his  Premiership.  The  Count 
is  known  to  be  bent  on  applying  to  China  the  same 
method  he  used  in  Korea  while  he  was  Governor- 
General  in  exploiting  and  then  obtaining  the  com- 
plete subjugation  of  that  unfortunate  country. 
Nishihara  was  first  sent  to  China  in  1917  before 
China’s  declaration  of  war  against  Germany  and 
Austria-Hungary  in  quest  of  new  concessions.  His 
second  secret  mission  to  China  was  in  connection 
with  the  Arms  Loan,  the  successful  conclusion  of 
which  brought  to  him  a great  personal  triumph.  And 
like  the  shadow  of  the  ghost  in  Macbeth,  Nishihara 
appeared  on  the  Chinese  stage  for  the  third  time 
when  he  was  entrusted  with  the  mission  of  secur- 
ing China’s  wine  and  tobacco  monopoly.  Well-in- 
formed people  in  Peking,  and  particularly  the  for- 
eign diplomatists,  unanimously  agree  that  Nishi- 
hara is  responsible  for  many  of  the  secret  loans 
contracted  by  the  Chinese  military  leaders  for  mil- 
itary purposes.  In  other  words,  he  is  the  deus  ex 
machina  of  all  the  underhand  transactions  between 
a group  of  wilful  and  ignorant  military  leaders  in 
China,  and  the  selfish,  intriguing  and  ambitious 
politicians  in  Japan. 

This  is  not  so  bad.  The  worst  is  yet  to  come. 
One  favorite  scheme  of  Japan  in  undermining  the 
political  stability  of  the  Chinese  Republic  consists 
in  arranging,  organizing,  and  subsidizing  insurrec- 
tions in  China  when  and  wherever  necessary.  It  is 

5Q 


said  that  secret  agreements  have  been  entered  into 
bet’ween  the  revolutionary  party  in  China  and 
numerous  wealthy  merchants  and  politicians  in 
Japan.  Whether  it  is  true  or  not,  it  is  not  an  im- 
portant question.  The  thing  of  importance  is  the 
undisputed  fact  that  in  the  successive  revolutions 
in  China,  in  1911,  in  1913,  and  in  1917,  the  Chinese 
revolutionaries  were  amply  supplied  with  Japan- 
ese money,  Japanese  arms,  and  Japanese  soldiers 
and  military  instructors.  When  the  revolutionary 
leaders  visited  Japan  either  for  the  purpose  of  con- 
cluding new  loans  or  for  the  purpose  of  getting 
more  military  supplies,  they  were  invariably  enter- 
tained by  Japanese  Chambers  of  Commerce,  feted 
by  Japanese  politicians,  and  received  and  welcomed 
by  Japanese  officials,  in  open  defiance  of  the  Pe- 
king Government  which  was  supposedly  on  friendly 
terms  with  Japan.  When  the  revolution  failed,  the 
ringleaders  inevitably  and  invariably  took  flight  to 
Japan  where  they  could  always  find  their  heaven 
on  earth  and  gather  together  their  remnants  for  a 
new  outbreak.  On  the  other  hand,  the  Peking 
Government  was  often  in  such  cases  diplomatically 
assured  of  Japan’s  sympathy,  amply  supplied  with 
the  sinews  of  war,  and  encouraged  as  to  the  desir- 
ability of  suppressing  the  revolution.  By  following 
such  a line  of  tactics,  Japan  was  not  only  currying 
favor  with  both  sides,  not  only  prolonging  the  civil 
war  or  making  it  more  fierce,  not  only  undermin- 
ing China’s  constitutional  stability,  but  she  was 
also  enjoying  the  genuine  pleasure  of  fishing  in 
the  troubled  waters  whereby  she  could  net  the 
greatest  results  in  the  shortest  possible  time.  In 
other  words,  Japan  was  carrying  out  as  she  has 
always  done  a divide-and-rule  policy  in  China. 

Just  one  more  instance,  and  we  shall  consider 
60 


our  task  done.  In  August,  1918,  the  same  trick  of 
dividing  up  China  "was  repeated  when  the  docu- 
ment signed  by  Dr.  Wu  Ting-fang,  Minister  of 
Foreign  Affairs  of  the  Revolutionary  Government 
at  Canton,  was  presented  to  the  foreign  legations 
in  Peking,  asking  for  their  recognition.  Baron 
Hayashi,  then  Japanese  minister  at  Peking,  took 
this  opportunity  to  sound  the  views  of  the  allied 
and  American  Ministers  and  intimated  the  wish  of 
the  Japanese  Government  to  accord  recognition  to 
the  Southern  Military  Government.  Fortunately 
for  Ghina,  however,  no  encouragement  was  given 
by  the  allied  diplomats  to  the  Japanese  intimation. 
As  she  could  not  play  the  game  single-handed, 
Japan  had  no  other  choice  but  to  give  up  the  idea 
for  the  time  being.  But  curiously  enough,  an  edi- 
torial of  the  Osaka  Mainichi  of  August  30,  blamed 
it  all  on  the  American  Government.  “Regarding 
this  question  of  recognition,”  the  editorial  says, 
“although  the  Japanese  Government  may  take  sim- 
ilar actions  with  the  Allies,  yet  it  is  feared  that  the 
United  States  may  take  the  initiative  at  any  mo- 
ment as  in  the  case  of  the  Allied  expedition  to 
Vladivostock.  In  such  a case,  the  Japanese  Gov- 
ernment will  have  to  change  its  former  policy, 
which  has  been  in  support  of  the  Peking  Govern- 
ment (sic)  and  accept  the  proposal  of  America  to 
recognize  the  Ganton  Military  Government.”  The 
trick  was  very  clever,  but  the  tactics  resorted  to 
in  this  case  was  highly  reprehensible.  It  was  more 
than  the  usual  scheme  of  divide  et  inipera;  it  was 
more  than  an  effort  to  camouflage  Japan’s  own  real 
intention  of  recognizing  the  Ganton  Government.  It 
was  a dastardly  and  venomous  attempt  to  estrange 
the  friendly  relations  between  China  and  the  United 
States  by  making  the  Peking  Government  believe 

61 


that  it  was  the  tatter  that  really  essayed  for  the  rec- 
ognition of  the  revolutionary  government ! 

JAPANESE  DIPLOMACY 

Such  are  the  nefarious  schemes  which  Japan  has 
resorted  to  in  the  undermining  of  the  Chinese  Re- 
public and  in  building  up  her  own  influence  in 
China.  Such  are  the  political  aims  and  economic 
ambitions  which  the  Japanese  Empire  seeks  to  real- 
ize in  the  neighboring  Republic  which  is  not  so 
helpless  as  it  is  impotent.  We  must  admit  that 
what  has  been  said  in  the  foregoing  pages  about 
Japan’s  political  schemes,  economic  ambitions,  and 
territorial  aggressions  is  but  one  tithe  df  the  story 
and  it  is  not  too  much  to  say  that  the  whole  diplo- 
matic history  of  Chino-Japanese  relations  of  the 
last  twenty  or  thirty  years  is  but  a black  record  of 
bold-faced  swindling  and  double-dealing  which  is 
unsurpassed  by  the  Machiavellian  practices  of  medi- 
aevel  times.  Japan  has  essayed  in  more  ways  than 
one  for  territorial  expansion  in  China;  Japan  has 
endeavored  to  control  China’s  finance;  Japan  has 
determined  to  block  China’s  economic  development 
so  that  she  can  exploit  the  riches  herself;  and  Japan 
has  greatly  undermined  China’s  political  stability 
by  those  sinister  and  cruel  designs  and  schemes 
which  we  have  just  pointed  out.  These  are  the 
straws  which  indicate  in  an  unmistakable  fash- 
ion the  direction  in  which  Japan’s  diplomacy  is 
blowing.  Undoubtedly,  as  it  is  physically  impos- 
sible otherwise,  the  boat  has  to  follow  the  sail  in 
the  direction  in  which  the  wind  blows.  The  Jap- 
anese ship  of  state  has  been  sailing  for  the  last 
four  years  on  comparatively  smooth  water ; but 
with  the  returning  of  the  political  storm  to  the  Far 
East,  the  Pacific  Ocean  will  cease  to  be  pacific, 

62 


and  diplomatic  dealings  with  China  will  be  no 
longer  such  easy  plain  sailing. 

Without  plying  too  deeply  into  the  subject,  we 
can  safely  assume  that  ever  since  her  emergence 
as  a world  power  Japan  has  maintained  a double 
standard  diplomacy,  one  for  use  with  the  strong 
powers — such  as  the  United  States,  Great  Britain — 
and  the  other  for  weak  nations — such  as  Siam  and 
China.  That  is,  in  her  relations  with  Europe  and 
America,  Japan  has  shown  a studied  and  careful 
observance  of  the  traditions  of  diplomacy  and  the 
established  rules  of  international  law,  while  in  her 
relations  with  weak  neighbors  she  has  constantly 
resorted  to  the  use  of  brutal  tactics  of  military 
diplomacy  which  she  has  copied  from  her  Teutonic 
master.  Cajolement  and  dissimilation  characterize 
the  former,  force  and  threat  distinguish  the  latter. 
What  Japanese  diplomacy  has  been  trying  to  ac- 
complish in  Europe  and  in  the  United  States  is  to, 
in  the  words  of  Viscount  Hayeshi,  “lull  the  sus- 
picions that  have  arisen  against  her,”  and  to  make 
black  white  by  organized  publicity,  in  order  that 
Japan  may  be  able  to  continue  her  sinister  game  in 
China  unquestioned  and  unchecked,  until  events 
have  already  gone  too  far  for  checking.  What  Jap- 
anese diplomacy  has  been  trying  to  accomplish  in 
China  is  to  browbeat  her,  to  exploit  her,  to  squeeze 
her,  to  dominate  her,  to  close  the  open  door,  to  un- 
dermine her  political  stability,  to  get  hold  of 
everything  worth  having,  and  to  reap  all  the  bene- 
fits to  the  exclusion  of  all  other  interests,  quietly  if 
possible,  openly  if  otherwise.  That  is  what  Japan 
has  been  seeking  after.  Those  who  have  learned 
the  inner  workings  of  the  Japanese  mind  and  the 
vaulting  ambitions  of  the  Japanese  Government 
will  chuckle  at  the  moderation  of  this  statement. 

63 


“It  is  extremely  hard  to  discuss  the  question  of 
Japan,”  writes  the  author  of  The  Fight  for  the  Repub- 
lic in  China,  “for  the  benefit  of  an  exclusively  Western 
audience  in  a convincing  way,  because  Japanese 
policy  has  two  distinct  faces,  which  seem  utterly 
contradictory,  and  yet  which  are,  in  a great  meas- 
ure, understandable  if  the  objects  of  that  diplo- 
macy are  set  down.  Being  endowed  with  an  extra- 
ordinary capacity  for  taking  detached  views,  the 
statesmen  of  Tokio  long  ago  discovered  the  neces- 
sity of  having  two  independent  policies — an  East- 
ern policy  for  Eastern  Asia  and  a Western  policy 
for  Western  nations — because  East  and  West  are 
essentially  antithetical  and  cannot  be  treated  in 
precisely  the  same  manner.  Whilst  the  Western 
policy  is  frank  and  manly,  and  is  exclusively  in  the 
hands  of  brilliant  and  attractive  men  who  have  been 
largely  educated  in  the  schools  of  Europe  and 
America  and  who  are  fully  able  to  deal  with  all  mat- 
ters in  accordance  with  the  customary  traditions  of 
diplomacy,  the  Eastern  policy  is  the  work  of  ob- 
scurantists whose  imaginations  are  held  by  the  vast 
projects  which  the  Military  Party  believes  are 
capable  of  realization  in  China.”  It  is  the  observa- 
tion of  an  expert  on  the  Far  Eastern  question,  and 
as  such  it  merits  careful  consideration.  We  are 
glad  that  we  are  not  the  only  ones  who  have  be- 
lieved that  Japan  has  maintained  a double-standard 
diplomacy. 

The  key  to  Japanese  diplomacy,  however,  is  to 
be  found  in  Japan’s  military  and  naval  strength, 
which  constitutes  her  claim  to  a seat  among  the 
family  of  great  nations.  On  this  point  we  are  ab- 
soluteh^  sure  that  Japan  cherishes  no  illusions. 
Her  statesmen  know  very  well  wherein  lies  the 
-source  of  Japan’s  diplomatic  influence.  It  was 

64 


Count  Okuma  who  made  this  point  clear  beyond 
doubt.  “Diplomacy,”  he  said,  “to  be  really  efifec- 
tive  and  successful  must  be  backed  by  sufficient 
national  strength.  It  is  only  ten  or  fifteen  years 
since  Japanese  diplomacy  began  to  carry  weight 
with  foreign  countries,  and  it  began  from  the  time 
that  Western  Powers  commenced  to  recognize 
Japan’s  military  strength.”  And  so  it  is  true  Jap- 
anese diplomacy  was  nothing  before  the  Chino- 
Japanese  war.  Japanese  diplomacy  is  everything 
after  the  war.  The  Far  East  which  was  a happy 
hunting-ground  for  the  European  Powers  ceases  to 
be  such  with  the  rise  of  Japan.  In  1902  the  first 
Anglo-Japanese  alliance  was  concluded ; in  1904  it 
was  renewed.  Russia  and  Japan,  which  were  at 
each  other’s  throats  in  years  immediately  before 
1004,  became  fast,  warm  friends  after  the  war. 
France  was  also  ready  to  enter  into  diplomatic  un- 
derstanding with  the  Empire  of  the  Rising  Sun, 
while  the  United  States  thought  it  convenient  to 
make  a Gentleman’s  agreement.  We  have  thus  a 
diplomatic  web,  thickly  woven,  with  Japan  at  the 
center  as  the  industrious  spider.  But  why  were  the 
United  States  and  the  European  Powers  so  glad 
of  taking  Japan’s  hand  and  following  her  lead  ? 
Well,  it  was  because  of  her  military  and  naval 
strength,  which  is  an  omnipotent  factor  in  interna- 
tional politics.  It  is  because  of  her  predominant 
position  in  the  Far  East,  which  is  backed  up  and 
sustained  by  her  fighting  strength.  There  is  no 
denying  that  Japan,  just  because  of  her  position  and 
power,  has  assumed  a leading  role  in  the  Far  East- 
ern politics.  Like  an  octopus  living  in  the  turbu- 
lent waters  of  modern  diplomacy,  she  stretches  out 
her  arms  in  all  directions,  joining  a friend  here  and 
an  ally  there.  It  is  a natural  thing  to  do,  but  those 

65 


who  have  fallen  into  the  tentacles  must  know  how 
tight  is  the  grip. 

We  have  noticed  these  different  international 
agreements.  The  Anglo-Japanese  alliance  of  1904 
(which  was  again  renewed  in  1911),  the  Russo-Jap- 
anese agreement  of  1907  and  the  Franco-Japanese 
Coiivention  of  the  same  year.  With  these  combi- 
nations with  the  European  Powers,  Japan  suc- 
ceeded in  forming  an  envious  triangle  in  which  she 
cotdd  continue  to  weave  her  diplomatic  web  and 
from  which  she  expected  nothing  but  acquiescence 
in  her  China  policy.  It  was  Japan’s  policy  to  form 
a ring  of  nations  who  were  either  in  favor  of  or  at 
least  in  sympathy  with  the  Japanese  ambition  to 
exploit  China.  Germany,  whose  activities  in  China 
were  at  one  time  very  much  dreaded  by  the  Nip- 
ponese, was  not  admitted  into  the  charmed  circle. 
Japan  meant  to  isolate  her  in  Chinese  affairs  diplo- 
matically. But  the  United  States,  as  the  only 
Power  who  has  been  sincerely  but  disinterestedly 
interested  in  China  could  not  be  disposed  of  so 
easily.  Its  company  was  not  welcomed  by  Japan, 
but  its  presence  could  not  very  well  be  refused. 
Happily  the  Japanese  school  children  question  in 
San  Francisco  furnished  the  desired  occasion  of 
making  a new  declaration  of  American  and  Jap- 
anese policy  in  China.  The  Root-Takahira  Agree- 
ment was  the  result.  The  triangular  combination 
thus  became  a four-cornered  understanding. 

All  these  agreements  seemed  innocent  enough 
at  first  sight,  but  going  beneath  the  diplomatic 
verbiage  which  clothed  them  all  we  find  that  in 
bringing  them  about  , Japan  was  actuated  by 
the  most  sordid  motives.  In  the  first  place, 
Japan  sought  to  identify  her  policy  and 
her  aims  with  those  of  the  other  Powers, 

66 


so  that  in  all  Chinese  affairs  she  could  assume  a 
leading  role,  coud  act  as  the  spokesman  of  the 
whole  group.  In  other  words,  having  bound  them- 
selves to  the  stipulated  conditions,  other  Powers 
could  not  act  without  Japan’s  consent.  On  the 
other  hand,  Japan  sought  by  these  agreements  to 
“lull  the  suspicions  that  have  arisen  against  her.” 
These  agreements  were  so  many  “scraps  of  paper” 
as  far  as  Japan  was  concerned ; they  were  never 
meant  to  be  effective.  Their  only  use  was  perhaps 
to  soothe  the  sensibilities  of  the  Chinese  people 
and  the  world  at  large  who  might  be  shocked  by 
the  sordid  nature  of  Japan’s  diplomatic  dealings 
with  China.  This  is  the  essence  of  Japanese  diplo- 
macy, and  this  is  what  Japanese  diplomacy  has  been 
trying  to  accomplish. 

THE  OPEN  DOOR  POLICY 

It  must  be  remembered,  however,  that  in  Far 
Eastern  politics  nothing  occupies  so  much  attention 
or  has  been  more  talked  about  than  the  Open  Door 
Policy.  No  matter  what  is  Japan’s  imperialistic 
ambition,  no  matter  how  often  the  Japanese  Gov- 
ernment has  been  browbeating  China,  and  no  mat- 
ter whether  the  Open  Door  is  a fact  or  a fiction, 
Japan  has  indeed  professed  that  it  is  her  policy  in 
China.  We  have  noticed  that  what  Japanese  di- 
plomacy has  been  trying  to  accomplish  in  China 
is  to  browbeat  her,  to  exploit  her,  to  squeeze  her, 
to  dominate  her,  to  undermine  her  political  sta- 
bility, to  get  hold  of  everything  worth  having,  and 
to  reap  all  possible  benefits  to  the  exclusion  of 
all  other  interests — quietly  if  possible,  openly  if 
otherwise.  This  is  an  established  fact,  we  all  know. 
Yet  in  the  same  breath  Japan  professes  that  she 

67 


is  the  champion  of  the  Open  Door  policy.  History 
records  the  different  international  agreements 
which  Japan  has  entered  into,  either  for  the  altru- 
istic purpose  of  maintaining  the  peace  in  the  Far 
East  or  out  of  her  pure  chivalry  to  guarantee  the 
territorial  integrity  of  China  and  to  maintain  the 
open  door  policy!  The  Anglo-Japanese  alliances, 
the  Franco-Japanese  Convention,  the  Russo-Jap- 
anese Conventions  and  secret  treaties,  the  Root- 
Takahira  Agreement,  and  lately  the  Lansing-Ishii 
Agreement  are  part  and  parcel  of  the  entire  outfit 
which  the  Japanese  statesmen  and  diplomatists 
have  used  in  their  international  jugglings  in  regard 
to  the  maintenance  of  the  Open  Door  Policy  in 
China.  Without  examination  into  the  intentions 
and  motives  that  were  behind  these  international 
agreements,  these  efforts  to  maintain  the  Open  Door 
policv  are  highly  admirable.  Keeping  in  mind,  how- 
ever, the  Japanese  conduct  in  Manchuria,  in  Shan- 
tung and  in  Fukien,  indeed  the  whole  diplomatic 
relations  between  China  and  Japan  since  the  Rus- 
so-Japanese war,  one  is  at  a loss  to  see  whether 
Japan  has  understood  the  policy  rightly  or  wrongly. 
The  policy  which  Japan  pursues  is  certainly  not 
the  Open  Door  policy.  As  far  as  we  can  compre- 
hend the  question,  what  Japan  has  understood  of 
the  Open  Door  policy  is  that  it  is  a merely  diplo- 
matic principle,  discussed  among  foreign  powers  as 
one  worthy  of  following  but  one  having  no  binding 
force  upon  themselves  in  their  dealings  with  China. 
It  is  pleasing  to  speak  of  it  and  to  talk  about  it, 
but  it  is  contrary  to  Japan’s  imperialistic  interest 
to  carry  it  into  practice. 

About  the  Open  Door  policy  there  is,  indeed,  an 
imposing  array  of  international  agreements,  as 
those  mentioned  above.  How  much  they  are  worth 

68 


is  a question  that  can  be  best  answered  by  the  re- 
spect which  Japan  and  the  other  Powers  have  paid 
to  it.  In  such  a case,  deeds  always  speak  louder 
than  words.  No  nation  is  more  eloquent  in  the 
defence  of  the  Open  Door  policy  than  Japan,  and 
no  nation  appears  more  anxious  and  earnest  for 
its  maintenance  than  the  Nipponese  Empire.  But 
look  at  Japan’s  record  in  China ! Look  at  the  dip- 
lomatic by-path  which  she  pursues  in  China ! One 
will  be  shocked  at  her  deliberate  efforts  in  closing 
up  the  open  door.  Attack  after  attack  is  launched 
against  the  Chinese  Republic,  and  incidents  of  vio- 
lating the  Open  Door  policy  have  occurred  again 
and  again.  Not  to  say  Japan’s  unfair  means  of 
economic  discrimination  in  Manchuria,  not  to  men- 
tion her  conduct  in  Shantung  and  Fukien,  let  us 
all  remember  the  “twenty-one  demands”  which 
Japan  pressed  upon  the  Chinese  Government  in 
1915.  We  do  not  propose  to  comment  upon  the 
demands  seriatim — to  do  this  would  take  up  too 
much  space — but  we  beg  to  reproduce  the  infamous 
document  so  that  the  world  at  large  may  learn  how 
much  the  Open  Door  Policy  has  meant  to  Japan 
and  how  much  she  has  respected  it.  Here  follows 
“the  twenty-one  demands 

“Japan’s  Original  Twenty-one  Demands” 

Translations  of  Documents  handed  to  the  Pres- 
ident, Yuan-shih-kai,  by  Mr.  Hioki,  the  Japanese 
Minister,  on  January  i8th,  1915. 

GROUP  I 

The  Japanese  Government  and  the  Chinese 
Government  being  desirous  of  maintaining  the  gen- 
eral peace  in  Eastern  Asia  and  further  strengthen- 
ing the  friendly  relations  and  good  neighborhood 

69 


existing  between  the  two  nations  agree  to  the  fol- 
lowing articles; 

Article  i.  The  Chinese  Government  engages 
to  give  full  assent  to  all  matters  upon  which  the 
Japanese  Government  may  hereafter  agree  with 
the  German  Government  relating  to  the  disposition 
of  all  rights,  interests  and  concessions,  which  Ger- 
many, by  virtue  of  treaties  and  otherwise,  possesses 
in  relation  to  the  Province  of  Shantung. 

Article  2.  The  Chinese  Government  engages 
that  within  the  Province  of  Shantung  and  along  its 
coast  no  territory  or  island  will  be  ceded  or  leased 
to  a third  Power  under  any  pretext. 

Article  3.  The  Chinese  Government  consents 
to  Japan’s  building  a railway  from  Chefoo  or  Lung- 
kow  to  join  the  Kiao-chou-Tsinanfu  railway. 

Article  4.  The  Chinese  Government  engages,  in 
the  interest  of  trade  and  for  the  residence  of  for- 
eigners, to  open  by  herself  as  soon  as  possible  cer- 
tain important  cities  and  towns  in  the  Province 
of  Shantung  as  Commercial  Ports.  What  places 
shall  be  opened  are  to  be  jointly  decided  upon  in  a 
separate  agreement.  ■ 

GROUP  II 

The  Japanese  Government  and  the  Chinese  Gov- 
ernment, since  the  Chinese  Government  has  always 
acknowledged  the  special  position  enjoyed  by 
Japan  in  South  Manchuria  and  Eastern  Inner  Mon- 
golia, agree  to  the  following  articles : 

Article  i.  The  two  Contracting  Parties  mutu- 
ally agree  that  the  term  of  lease  of  Port  Arthur  and 
Dalny  and  the  term  of  lease  of  the  South  Manchu- 
rian Railway  and  the  Antung-Mukden  Railway 
shall  be  extended  to  the  period  of  99  years, 


70 


Article  2.  Japanese  subjects  In  South  Manchu- 
ria and  Eastern  Inner  Mongolia  shall  have  the  right 
to  lease  or  own  land  required  either  for  erecting 
suitable  buildings  for  trade  and  manufacture  or  for 
farming. 

Article  3.  Japanese  subjects  shall  be  free  to  re- 
side and  travel  in  South  Manchuria  and  Eastern 
Inner  Mongolia  and  to  engage  in  business  and  in 
manufacture  of  any  kind  whatsoever. 

Article  4.  The  Chinese  Government  agrees  to 
grant  to  Japanese  subjects  the  right  of  opening 
the  mines  in  South  Manchuria  and  Eastern  Inner 
Mongolia.  As  regards  what  mines  are  to  be  opened, 
they  shall  be  decided  upon  jointly. 

Article  5.  The  Chinese  Government  agrees 
that  in  respect  of  the  (two)  cases  mentioned  herein 
below  the  Japanese  Government’s  consent  shall  be 
first  obtained  before  action  is  taken; 

(a)  Whenever  permission  is  granted  to  the 
subject  of  a third  Power  to  build  a railway  or  to 
make  a loan  with  a third  Power  for  the  purpose  of 
biiilding  a railway  in  South  Manchuria  and  East- 
ern Inner  Mongolia. 

(b)  Whenever  a loan  is  to  be  made  with  a 
third  Power  pledging  the  local  taxes  of  South  Man- 
churia and  Eastern  Inner  Mongolia  as  security. 

Article  6.  The  Chinese  Government  agrees 
that  if  the  Chinese  Government  employs  political, 
financial  or  military  advisers  or  instructors  in  South 
Manchuria  or  Eastern  Inner  Mongolia,  the  Japan- 
ese Government  shall  first  be  consulted. 

Article  7.  The  Chinese  Government  agrees 
that  the  control  and  management  of  the  Kirin- 
Changchun  Railway  shall  be  handed  over  to  the 
Japanese  Government  for  a term  of  99  years  dating 
from  the  signing  of  this  Agreement. 


71 


GROUP  III 


The  Japanese  Government  and  the  Chinese  Gov- 
ernment, seeing  that  Japanese  financiers  and  the 
Hanyehping  Company  have  close  relations  with  each 
other  at  present,  and  desiring  that  the  common  in- 
terests of  the  two  nations  shall  be  advanced,  agree 
to  the  following  articles : 

Article  i.  The  two  Contracting  Parties  mutu- 
ally agree  that  when  the  opportune  moment  arrives 
the  Hanyehping  Company  shall  be  made  a joint 
concern  of  the  two  nations  and  they  further  agree 
that  without  the  previous  consent  of  Japan,  China 
shall  not  by  her  own  act  dispose  of  the  rights  and 
property  of  whatsoever  nature  of  the  said  Com- 
pany nor  cause  the  said  Company  to  dispose  freely 
of  the  same. 

Article  2.  The  Chinese  Government  agrees 
that  all  mines  in  the  neighborhood  of  those  owned 
by  the  .Hanyehping  Company  shall  not  be  per- 
mitted, without  the  consent  of  the  said  Company, 
to  be  worked  by  other  persons  outside  of  the  said 
Company ; and  further  agrees  that  if  it  is  desired  to 
carry  out  any  undertaking  which,  it  is  apprehended, 
may  directly  or  indirectly  affect  the  interests  of  the 
said  Company,  the  consent  of  the  said  Company 
shall  first  be  obtained. 

GROUP  IV 

The  Japanese  Government  and  the  Chinese  Gov- 
ernment with  the  object  of  effectively  preserving 
the  territorial  integrity  of  China  agree  to  the  fol- 
lowing special  articles; 

The  Chinese  Government  engages  not  to  cede 
or  lease  to  a third  Power  any  harbour  or  bay  or  isl- 
and along  the  coast  of  China. 

72 


GROUP  V 


Article  l.  The  Chinese  Central  Government 
shall  employ  influential  Japanese  advisers  in  politi- 
cal, financial  and  military  affairs. 

Article  2.  Japanese  hospitals,  churches  and 
schools  in  the  interior  of  China  shall  be  granted  the 
right  of  owning  land. 

Article  3.  Inasmuch  as  the  Japanese  Govern- 
ment and  the  Chinese  Government  have  had  many 
cases  of  dispute  between  Japanese  and  Chinese  po- 
lice to  settle  cases  which  caused  no  little  misunder- 
•standing,  it  is  for  this  reason  necessary  that  the  po- 
lice department  of  important  places  (in  China) 
shall  be  jointly  administered  by  Japanese  and  Chi- 
nese, or  that  the  police  departments  of  these  places 
shall  employ  numerous  Japanese,  so  that  they  may 
at  the  same  time  help  to  plan  for  the  improvement 
of  the  Chinese  Police  Service. 

Article  4.  China  shall  purchase  from  Japan  a 
fixed  amount  of  munitions  of  war  (say  50%  or 
more)  of  what  is  needed  by  the  Chinese  Govern- 
ment, or  that  there  shall  be  established  in  China  a 
Sino-Japanese  jointly  worked  arsenal.  Japanese 
technical  experts  are  to  be  employed  and  Japanese 
material  to  be  purchased. 

Article  5.  China  agrees  to  grant  to  Japan  the 
right  of  constructing  a railway  connecting  Wu- 
chang with  Kiuking  and  Nanchang,  another  line 
between  Nanchang  and  Hanchow,  and  another  be- 
tween Nanchang  and  Chaochou. 

Article  6.  If  China  needs  foreign  capital  to 
work  mines,  build  railways  and  construct  harbour- 
works  (including  Dockyards)  in  the  Province  of 
Fukien,  Japan  shall  be  first  consulted. 

Article  7.  China  agrees  that  Japanese  subjects 


73 


shall  have-  the  right  of  missionary  propaganda  in 
China.” 

There  is  no  need  to  waste  time  and  space  to 
point  out  how  these  sinister  demands  are  diametri- 
cally opposed  in  letter  and  spirit  to  the  open  door 
policy.  Indeed,  Japan’s  conduct  in  China  has  been 
such  that  it  is  impossible  to  reconcile  her  words 
with  her  deeds.  It  is,  however,  bare  justice  to 
China  to  say  that  Japan’s  diplomatic  conduct  in 
China  for  the  last  twenty  years  has  been  marked 
by  continued  insolence,  persistent  obstruction,  and 
nefarious  contumacy,  as  China’s  dealings  with 
Japan  have  been  distinguished  by  forbearance  and 
conciliation.  Any  one  who  happened  to  be  in  the 
Far  East  in  1915  and  had  breathed  the  foul  atmos- 
phere of  the  secret  negotiations  of  the  twenty-one 
demands  could  not  fail  to  have  been  conscious  of 
the  doom  that  seemed  to  be  hanging  over  the  Chi- 
nese Republic.  Here  is  the  best  summing  up  of  the 
situation  by  an  American  authority.  Prof.  Horn- 
beck  says:  “Whatever  her  intentions,  Japan  has  ac- 
complished in  regard  to  China  at  least  five  things : 
She  has  consolidated  her  own  position  in  Manchu- 
ria ; she  has  driven  Germany  out  of  Shantung  and 
constituted  herself  successor  to  Germany’s  rights; 
she  has  given  warning  that  she  considers  Fukien 
an  exclusive  sphere  for  Japanese  influence;  she  has 
undertaken  to  invade  the  British  sphere  of  influ- 
ence ; and  she  stands  in  a position  to  menace  and  to 
dictate  to  the  Peking  Government.  A glance  at  the 
map  of  north  China  will  show  how  completely  Pe- 
king is  at  Japan’s  mercy.  In  control  of  Port  Ar- 
thur and  of  the  Shantung  peninsula,  Japan  com- 
mands the  gulf  of  Pechili,  which  is  the  doorway  by 
sea  to  Tien-tsin  and  Newehwang.  In  possession  of 
Tsingtao,  and  virtually  of  Antung,  Japan  thus  com- 

74 


mands  every  important  port  and  harbour.  With 
the  Manchurian  railway  penetrating  the  heart  of 
Manchuria  and  the  Shantung  Railway  extending  to 
the  heart  of  Shantung — and  with  the  right  to  ex- 
tend the  latter  line  to  join  the  Peking-Hankow  line 
■ — Japan  is  in  a position,  should  she  so  chose,  at  any 
moment,  to  grind  Peking  between  the  millstones  of 
her  military  machine.  So  far  as  strategy  is  con- 
cerned, Japan  has  north  China  commercially,  mili- 
tarily, and  politically  at  her  mercy,” 

CONCLUSION 

We  have  here  before  us  in  outline  Japan’s  polit- 
ical ambitions  and  economic  designs  in  China,  and 
the  deadly  germs  of  the  Chino-Japanese  question. 
No  one  who  has  followed  the  story  as  given  in  the 
preceding  pages  can  fail  to  understand  that  Japan 
is  really  at  the  bottom  of  the  whole  trouble.  It  is 
Japan  who  has  repeatedly  browbeaten  China ; it  is 
Japan  who  has  been  after  territorial  expansion  on 
the  continent;  it  is  Japan  who  has  sought  after  the 
control  of  China’s  finance;  it  is  Japan  who  has  been 
trying  to  get  hold  of  anything  and  everything 
worth  having  in  China;  and  it  is  Japan  who  has  re- 
peatedly helped  the  revolutionists  in  China  to  start 
and  organize  rebellions  which  are  sure  to  under- 
mine the  delicate  constitution  of  the  infant  repub- 
lic. We  know  that  when  the  Chinese  Government 
asked  for  a revision  of  the  existing  tariff  at  the 
ridiculous  rate  of  five  per  cent,  ad  valorem,  Japan 
objected;  we  know  that  when  the  Chinese  Govern- 
ment made  a loan  from  the  American  capitalists  for 
Manchurian  development,  Japan  objected;  we 
know  that  when  the  Chinese  Government  decided 
to  construct  a railway  from  Sin-min-tun  to  Faku- 

7S 


man  in  Manchuria,  Japan  objected.  Indeed,  there  has 
not  been  a single  instance  of  which  Japan  can  boast 
as  proving  her  much  advertised  intention  of  help- 
ing China.  On  the  very  contrary,  Japan  has  been 
doing  her  level  best,  moving  heaven  and  earth,  to 
block  China’s  economic  development,  to  make  her- 
self the  virtual  master  of  her  giant  neighbour,  and 
to  injure  the  prestige  of  the  Chinese  Republic 
abroad  and  its  reforms  at  home.  To  the  outside 
world  which  is  not  at  all  acquainted  with  the  truth  of 
the  Chino-Japanese  relations,  and  to  those  who 
have  looked  at  the  Chinese  question  only  through 
the  Japanese  spectacles,  the  seven-years-old  Re- 
public seems  to  be  a spineless  nation.  The  truth  of 
the  matter  is  that  the  back-bone  of  China  has  been 
broken  by  Japanese  attacks.  China  has  not  been 
able  for  the  last  twenty  years  either  to  stand  up  or 
sit  down  long  enough  not  to  be  bothered  by  Jap- 
anese encroachments.  In  such  precarious  predica- 
ment China  has  found  herself  ever  since  the  year  of 
Chino-Japanese  War.  It  is  high  time  that  she 
should  be  enabled  to  get  out  of  it,  and  it  is  neces- 
sary that  the  United  States  and  the  European  Pow- 
ers who  have  fought  the  war  for  justice  and  for  the 
rights  of  the  weak  nations  should  lend  a helping 
hand  to  China.  The  infant  Republic  is  not  only 
struggling  for  justice — the  Republic  is  also  strug- 
gling for  existence.  In  the  words  of  President  Wil- 
son, we  venture  to  ask,  “Shall  strong  nations  be 
free  to  wrong  weak  nations  and  make  them  subject 
to  their  purpose  and  interest?  Shall  there  be  a 
common  standard  of  right  and  privilege  for  all  peo- 
ples and  nations,  or  shall  the  strong  do  as  they  will 
and  the  weak  suffer  without  redress?”  Upon  a cor- 
rect answer  to  these  questions  depends  the  solu- 
tion of  the  Chino-Japanese  question.  Japan,  a mil- 

76 


itant,  conquering  and  colonising  nation,  has  been 
engaged  in  the  grim  endeavour  to  become,  not  only 
the  leading  commercial  and  industrial  state  in  the 
Far  East,  but  also  a dominating  power  over  the 
Chinese  Republic.  While  the  latter  country,  the 
home  of  a peace-loving  and  law-abiding  people,  is 
struggling  for  existence  against  great  odds,  against 
foreign  domination,  and  against  the  onerous  bur- 
dens which  had  been  thrust  upon  her  shoulder  in 
the  early  days  of  foreign  intercourse.  If  the  Chino- 
Japanese  question  is  to  be  solved  at  all,  the  solu- 
tion lies  in  setting  China  on  her  feet  again.  The 
best  and  the  only  way  to  do  it  is  to  take  Japan  out 
of  the  ring,  or  at  least  to  stop  Japan’s  sinister  de- 
signs upon  China,  and  to  remove  those  crushing 
burdens  under  which  China  has  been  chafing  for  the 
last  score  of  years.  When  this  is  done,  the  Chi- 
nese Republic  will  be  free  to  develop  itself,  A free 
and  strong  China  is  itself  a solution  of  the  Chino- 
Japanese  question. 

This  brings  us  back  to  the  point  where  we  have 
started.  The  peace  conference  at  Versailles  must 
take  into  serious  consideration  that  the  world  will 
have  no  peace,  no  permanent  peace,  unless  the  Far 
Eastern  question  (which  is  a Chino- Japanese  ques- 
tion as  we  have  proved)  is  settled,  and  settled  right. 
It  will  be  worse  than  chronic  folly  to  blink  at  this 
potential  source  of  future  trouble,  when  it  is  perfectly 
possible  to  remove  all  the  dangerous  germs  that  have 
been  fermenting  the  Far  Eastern  yeast.  It  will  be 
little  short  of  crime  to  be  indifferent  to  the  cries 
for  justice  when  justice  does  not  only  mean  fair 
and  impartial  treatment  but  also  future  peace  of  the 
world.  The  war  is  fought  to  make  the  world  safe 
for  democracy;  but  the  world  will  not  be  safe  for 


77 


democracy,  until  the  autocratic,  the  bureaucratic,  and 
the  monarchical  governments  are  either  entirely  wiped 
out  if  possible  or  made  impotent  to  harm  the  demo- 
cratic institutions.  The  war  is  also  fought  to  make 
the  rights  of  the  small  and  weak  nations  respected; 
but  the  rights  of  the  small  and  weak  nations  will  not 
be  respected,  unless  the  strong  nations  who  have 
been  in  the  habit  of  violating  them  are  restrained.  It 
is  Japan,  the  autocratic  and  bureaucratic  Japan,  who 
started  Yuan  Shih-Kai  on  the  monarchical  venture 
in  1915-16.  That  Japan  does  not  wish  to  see  a strong 
China  with  an  efficient  Republican  government  is  an 
admitted  fact.  It  is  Japan,  the  imperialistic  and  mili- 
taristic Japan,  who  made  the  twenty-one  demands 
upon  China.  That  Japan  has  bullied  China  and  re- 
peatedly violated  her  sovereign  rights,  is  patent  to  the 
entire  world.  Do  we  have  to  repeat  those  squalid 
stories  in  order  to  show  that  Japan,  through  her  mil- 
itaristic bureaucracy  at  home  and  imperialistic  de- 
signs abroad,  is  the  real  enemy  of  democracy?  Is 
our  memory  so  short  as  to  forget  Japan’s  violation 
of  the  neutrality  of  China  first  in  the  Russo-Japanese 
War  of  1904-5  and  then  again  in  the  present  war  in 
1914?  Is  the  world  blind  to  the  fact  that  Japan, 
through  her  extra-territorial  privileges  in  China  and 
her  banking  and  postal  systems,  has  carried  on  sys- 
tematically the  morphia  and  opium  traffic  in  China, 
in  contravention  to  the  Opium  Agreement  of  1909  to 
which  she  is  a signatory,  and  in  defiance  of  the 
moral  law  of  the  civilized  world?  It  is  thus  evident 
that  the  Chino- Japanese  question  is  not  merely  a 
question  between  the  two  countries  concerned.  In 
its  larger  aspects,  it  is  a case  of  democracy  against 
autocracy,  of  liberalism  against  imperialism,  of  law 

78 


against  license,  and  of  self-preservation  against  ag- 
grandizement. Such  being  the  case,  there  is  but  one 
thing  left  for  the  world  to  do.  It  is  to  champion 
democracy  in  its  fight  against  autocracy,  to  help  liber- 
alism displace  imperialism,  to  enforce  law  against 
license,  and  to  assist  the  weak  peoples  in  their  up- 
hill struggle  for  development  and  self-preservation 
in  face  of  foreign  encroachments  and  aggressions 
which  menace  their  very,  right  of  existence.  The 
war  will  have  been  fought  in  vain  if  these  fundamen- 
tals— democracy,  justice,  and  the  rights  of  weak  na- 
tions— are  not  attained.  The  peace  conference  will 
turn  out  to  be  an  absolute  failure  if  it  refuses  to 
face  the  tremendous  facts  that  have  been  surging  the 
filthy  waters  of  Far  Eastern  politics,  and  to  settle  the 
question  as  it  should  be  settled  in  the  interest  of 
peace  and  for  the  good  of  all.  But  can  the  world 
have  peace  while  China  is  every  day  threatened  with 
war?  Can  the  peace  settlement  be  a just  one  if  the 
grievances  of  a nation  of  400,000,000  people  are  not 
redressed,  and  their  wrongs  are  not  righted? 


79 


All  communications  addressed  to 


Mr.  K.  P.  Wang, 
(Secretary  of- the  Committee) 
510  West  113th  St., 
New  York  City. 


A 


k 


atttancb  printing  company 
^^110-114  west  32nd  Street 
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